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2017 (5) TMI 66 - AT - Income TaxAssessment against non-existing entity - amalgamated company - Held that:- The assessment for the A.Y 2008-09 in respect of the amalgamating company and also the amalgamated companies have been completed separately, but in the name of the amalgamating company only. The only difference is in the PAN Nos. mentioned in the assessment years. As rightly held by the CIT (A), the amalgamating company was in existence for the A.Y 2008-09, though by the time of the assessment, it had amalgamated with the amalgamated company. On bringing the factum of amalgamation to the notice of the AO, the case has been transferred to the jurisdiction of the AO under whom, the amalgamated company’s registered office was located and the assessment is also made in the name of the amalgamated company. The mention of the PAN No. of the amalgamating company is only to differentiate between the amalgamated and amalgamating companies. Therefore, we see no reason to interfere with the order of the CIT (A) and the assessee’s ground of appeal No.1 is thus rejected. Computing deduction u/s 10A - treating the forex fluctuation gain as export turnover as well as total turnover - Held that:- We find that the forex gain is on account of the export turnover of the assessee and therefore, it is to be part of the export and total turnover as rightly held by the CIT (A). The CIT (A) had followed the decisions of various High Courts and the Tribunal which are reproduced at Para 6.4 of the CIT (A)’s order. The CIT (A) has also brought out the distinguishing facts in the case of Shah Originals (2010 (4) TMI 216 - BOMBAY HIGH COURT) that in that case the forex gain or loss was on account of re-statement of EEFC account and not as to whether it pertains to difference in billed amount as per the invoices and realized amount. Therefore, we see no reason to interfere with this finding of the CIT (A). However, as regards the miscellaneous income of ₹ 32,65,209 is concerned, there is no breakup of the income and as to the exact nature of such income. Therefore, we are of the opinion that the same is to be excluded both from the export turnover as well as the total turnover for computing the deduction u/s 10A of the Act. The profits and gains of each of the eligible unit is to be computed independently for allowing deduction u/s 10A of the Act with regard to an undertaking. The foreign exchange gain is part of the operating income of the assessee and therefore, to be included both in export as well as total turnover for computing deduction u/s 10A of the Act.
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