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2019 (3) TMI 570 - ITAT COCHINRevision u/s 263 - AO passed the revised order restricting the claim u/s 80RR - treating the whole gross receipts of foreign income earned from foreign sources so as to grant deduction u/s. 80RR - HELD THAT:- There is no justification for treating the whole gross receipts of foreign income instead of gross total income earned from foreign sources so as to grant deduction u/s. 80RR. The gross foreign receipts were accounted by the assessee and from that, net foreign income is to be ascertained and thereafter, deduction u/s. 80RR is to be granted at specified rate. The expenses considered by the AO is to be deducted from the gross foreign receipts. The contention of the assessee that gross foreign receipts is to be considered so as to grant deduction u/s. 80RR of the Act is devoid of merit. The foreign income represented net income received and deposited into Bank account and it is not gross foreign receipts. Reliance is placed on the judgment of the Supreme Court in the case of CIT vs. P.K. Jhaveri [1989 (11) TMI 1 - SUPREME COURT] wherein it was held that deduction u/s. 80K of the Act was allowable to the assessee only on the amount after deduction of the interest paid on moneys borrowed specifically for investment in the shares and not on the gross amount received. We place reliance on the judgment in the case of Industrial Consulting Bureau Pvt. Ltd. vs. CIT [1991 (3) TMI 129 - BOMBAY HIGH COURT] wherein it was held that relief u/s. 80M has to be allowed on net income and not on gross income. The same view was taken by the Rajasthan High Court in the case of Mahavir Kumar Jain vs. CIT [2004 (9) TMI 72 - RAJASTHAN HIGH COURT] with regard to deduction u/s. 80TT. We find that there is no force in the argument of the Ld. AR and the case law relied on by him and it cannot be applied to the assessee’s case. Hence, this ground of appeal of the Revenue is allowed.
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