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2016 (11) TMI 952 - AT - Income TaxEligibility of deduction under section 10AA - Held that:- We find the claimed deduction under section 10AA of the Act was started in 2007 for which approval was granted by CSEZ Development Commissioner, permitting the assessee to establish the unit at SEZ to undertake its trading activity. The assessee purchases item like cigarettes and foreign liquor, beside other foreign suppliers, from Flamingo DFS Pvt. Ltd. and from Flamingo Duty Free Shop Pvt. Ltd. having their registered office at Navi Mumbai. These two concerns import the item from abroad and Flamingo got the licence to operate duty free shops at various air ports/sea ports in India and also has bonded warehouses in different cities in India wherever its duty free shops. The purchases made by the assessee are by way of high seas purchases wherein the goods are sold by Flamingo to the assessee, while the cargo is on the high seas. These are done through high seas sales contract. The necessary documents were duly examined by the learned Commissioner of Income-tax (Appeals) and this factual matrix is not controverted by the Revenue. Original bill of lading, bill of entry were also examined. The purchases were made on the high seas and not in India. There is not a single instance where the local purchases were made within India.The totality of facts/provisions of SEZ Act and SEZ Rules provides that the benefit of section 10AA is available on trading. The ratio laid down in Gitanjali Exports Corporation Ltd. [2013 (11) TMI 563 - ITAT MUMBAI ] supports the case of the assessee. - Decided in favour of assessee MAT computation - Held that:- Since we have upheld the claimed deduction under section 10AA of the Act in favour of the assessee there is no question of adding the same while computing the book profit under section 115JB of the Act. Thus we find no merit in the appeal of the Revenue.
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