Eligibility of 100% EOU to get the exemption u/s 10 B

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..... Eligibility of 100% EOU to get the exemption u/s 10 B
Query (Issue) Started By: - Adoni Raghavendra Dated:- 22-9-2009 Last Reply Date:- 25-9-2009 Income Tax
Got 2 Replies
Income Tax
Dear All, I have an doubt to clarify about the deduction U/s 10B of Income Tax Act, 1961. for the export made through 100% EOU. A 100% EOU has an contractual agreement with third party[MMTC], as a service .....

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..... buyer, that the 3rd party [MMTC]has to complete the export sale with the foreign buyer located by the 100% Export oriented unit. The contract entered between MMTC & 100% EOU and the price are INR equivalent to the USD [$] as on the date of sale realization received by the service buyer. The Seller[100% EOU] raise the invoice on Service Buyer in USD[$] after the completion of the shipment. The paym .....

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..... ent has been released by the service buyer in INR equivalent to the total USD[$] as per invoice raised by 100% Export oriented unit. I feel that the foreign exchange conversion done by the service buyer since he received the foreign exchange. Further in the shipping bill the service buyer given the declaration that 100% EOU is the manufacturer & Exporter. Please clarify the doubts whether the 100% .....

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..... EOU is eligible to get the exemption u/s 10B a) As 100% Export b) As Deemed Export Kamal Kumar Bagaria. Reply By Surender Gupta: The Reply: There was a concept of disclaimer certificate u/s 80HHC for the purpose of allowance of deduction to supporting manufacturer. In this case also, the status of 100% EOU appears to be a supporting manufacturer which is attracting the provisions of section 10B .....

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..... . There is corresponding provision u/s 10B which allowed exemption on the basis of disclaimer certificate. Reply By R.S. Mangal: The Reply: There is no concept of deemed export in sec. 10B of income tax act, 1961. in case of third party export made by 100% EOU, the benefit under 10B is not available. though such deemed export is counted towards fulfilment of export obligation/NFE under para 6.9 .....

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..... of the FTP.
Discussion Forum - Knowledge Sharing .....

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