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2021 (1) TMI 168 - HC - Income TaxDeduction u/s 10A in respect of provisions written back towards link charges and annual day expenses and the said claim was not derived by an undertaking from the export of article or thing or computer software - HELD THAT:- This issue is covered by the decision of this Court in M/s. California Software Co. Ltd. [2020 (2) TMI 1234 - MADRAS HIGH COURT] wherein took a view that the income brought to tax under Section 41 of the Act by reversal of the entry with regard to the stock option given to the employees is also in the nature of 'export income' and therefore, the Assessee is entitled to exemption / deduction under Section 10-A / 10-B of the Act and the view taken by the learned Tribunal is not sustainable. Foreign Exchange Fluctuation Gain - HELD THAT:- This issue is covered by the decision in CIT v. M/s. Pentasoft Technologies Ltd. [2010 (7) TMI 75 - MADRAS HIGH COURT] the assessee does not determine the exchange value of the Indian Rupee. It has to be remembered but for the fact that the assessee is an expot house, there was no question of earning any foreign exchange. Therefore, when the fluctuation in foreign exchange rate was solely relatable to the export business of the assessee and the higher Rupee value was earned by virtue of such exports carried out by the assessee, there is no reason why the benefit of Section 10(A) should not be allowed to the assessee. Foreign Currency Expenditure and Communication Charges - HELD THAT:- The same are covered by a decision of this Court in CIT v. M/s. Zylog Systems Limited [2020 (3) TMI 181 - MADRAS HIGH COURT] wherein, it was held that such expenditure incurred by the Assessee in foreign currency will also be includible in the definition of 'export turnover' for the purpose of computing deduction under Section 10B of the Act. Set off of brought forward losses before allowing tax holiday deduction is covered by the decision in CIT v. M/s. Yokogawa India Ltd. [2016 (12) TMI 881 - SUPREME COURT] - From a reading of the relevant provisions of Section 10A it is more than clear to us that the deductions contemplated therein is qua the eligible undertaking of an assessee standing on its own and without reference to the other eligible or non-eligible units or undertakings of the assessee. The benefit of deduction is given by the Act to the individual undertaking and resultantly flows to the assessee. Though Section 10A, as amended, is a provision for deduction, the stage of deduction would be while computing the gross total income of the eligible undertaking under Chapter IV of the Act and not at the stage of computation of the total income under Chapter VI. Revenue appeal dismissed.
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