TMI Blog2011 (4) TMI 793X X X X Extracts X X X X X X X X Extracts X X X X ..... e actually transferred to Wholly Owned Subsidiary as an investment within the extended time by RBI, it is to be considered for exemption u/s 10A if the other conditions are fulfilled by the assessee and similar is the position in case of work in progress - The Assessing Officer has to re-compute deduction u/s 10A considering the work in progress/future receivables as not entitled for exemption under section 10A - The assessee has to reconcile with reference to work in progress realised and transferred it into investment in WOS to avail deduction u/s10A and the Assessing Officer is to grant the deduction u/s 10A, if it is within the extended time - Hence, the revenue appeals are partly allowed. - IT APPEAL NOS. 316 TO 320 (HYD.) OF 2010 - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case are that the assessee is engaged in software development and the returns of income filed for the assessment years from 2002-03 to 2005-06 have been reopened under section 147 and return of income for the assessment year 2006-07 is completed under section 143(3). In all these years, the deduction claimed by the assessee company under section 10A has been denied for the export sales proceedings were not received within six months from the end of the relevant financial years. While rejecting the claim for exemption under section 10A, the Assessing Officer has also rejected the information furnished by the assessee in the form of statement of invoices and realisation along with copies of Foreign Inward Remittance Certificates (FIRCs). The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the share capital of Wholly Owned Subsidiary out of sale proceedings the assessee is claiming the deduction under section 10A. According to the Assessing Officer, the assessee has to realise export proceedings, thereafter it has to contribute to the share capital Wholly Owned Subsidiary, which the assessee has failed to do so. As such, the assessee is disentitled for deduction under section 10A. The DR submitted that on appeal CIT(A) allowed the claim of the assessee under section 10A of the Act and also deleted the addition made under section 40(a)(ia) of the Act. The AR relied on the order of the CIT(A). 5. We have heard both the parties and perused the materials available on record. Before the first appellate Authority, the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the first appellate stage. Being so, we do not fine any infirmity in admitting the additional evidence by CIT(A) for adjudication. The CIT(A) during the first appellate stage called for the summary of monies remitted and received through different modes by the assessee. The CIT(A) after examination of documents came to the conclusion that all the remittance were supported with FIRCs or approval from RBI for investing in Wholly Owned Subsidiary or remittance into approved bank accounts maintained in abroad. The assessee also furnished all the required statements in the form of FIRCs or RBI approvals. This has been considered by the CIT(A) after confronting the same to the Assessing Officer. All the monies received by the assessee were suppor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sankhya Sari with the appropriate approval from RBI that certain amount of Euros be invested into this company within one year from the date of approval. This approval is relevant for the assessment years 2002-03 to 2003-04 and in both the years, it has been proved by the assessee that the said monies were invested into the Wholly Owned Subsidiary within the period of one year from the date of RBI s approval. Hence the conditions laid down is complied with by the assessee and the department has not brought on record that the conditions laid down by RBI has not complied with. Being so, we are in agreement with the order of the CIT(A). The revenue is having also objection regarding that the CIT(A) has granted deduction under section 10A in r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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