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TMI Blog2014 (1) TMI 909X X X X Extracts X X X X X X X X Extracts X X X X ..... pects of deduction u/s 10B. Briefly stated the facts of the case are that the assessee having manufacturing unit at Amritsar claimed deduction u/s. 10B amounting to Rs.1,11,62,462/- being profit derived from 100% Export Oriented Unit. The Assessing Officer observed that the assessee has two units, one at Amritsar and other at Mumbai. Mumbai unit was found to be engaged in trading activities. The Assessing Officer found that the assessee had not properly allocated Commission and Salary expenses between the Amritsar and Mumbai units. The assessee was called upon to explain as to why these expenses should not be apportioned in the ratio of turnover of the two units. The assessee made submission accepting that at the most some percent of salary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e have heard the rival submissions and perused the relevant material on record. We find that this issue has been decided by the Special Bench of the Tribunal in Maral Overseas Ltd. vs. Addl. CIT (2012) 146 TTJ (Ind) (SB) 129 by holding that the export incentives form part of `profits of the business' of the eligible undertaking and hence cannot be excluded from the eligible profit for the purpose of computing deduction u/s.10B. The impugned order, being contrary to the view expressed by the special bench in this case, is therefore set-aside on this issue. 6. Last issue is about the denial of deduction u/s. 10B in respect of interest income of Rs.71131. We find that there is no discussion in the assessment order about the nature of interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ately if the impugned order on this issue is set-aside and the matter restore to the file of A.O. We order accordingly and direct him to first decide the head under which said interest income of Rs.71,311/- falls and thereafter take a decision on the inclusion or otherwise of such amount in the eligible profits for the purpose of deduction u/s. 10B. The judgment of the Hon'ble Supreme Court in ACG Associated Capsules Pvt. Ltd. VS. CIT (2012) 343 ITR 89 (SC) relied by the ld. AR for the proposition of `netting of interest' is relevant in the context of Explanation (baa) below section 80HHC(4C) defining the expression `profits of the business'. It has no application under sec. 10B, which is differently worded and has no definition of the expr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he result, the appeal of Revenue for A.Y. 2006-07 is dismissed. A.Y.2007-08 in ITA NO.3931/Mum/2012 12. This appeal by the assessee is against the reduction in the amount of deduction u/s. 10B. 13. The first issue is about the bifurcation of Commission and Salary between the Amritsar and Mumbai units in the ratio of their respective turnovers. Both these sides are in agreement that the facts of this ground are similar to those of the preceding year. In view of our decision taken hereinabove, we uphold the impugned order on this issue. 14. Second issue is about the denial of deduction in respect of interest of Rs.1,07,857/-. Here also both the parties are in agreement that the facts of the instant year are mutatis mutandis similar to tho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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