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TMI Blog2015 (10) TMI 1592X X X X Extracts X X X X X X X X Extracts X X X X ..... under the Special Economic Zones Act at Mahindra World City - Special Economic Zone at Kanchipuram District and entitled for deduction under section 10AA of the Act. The assessee has complied with all the provisions of Section 10AA of the Act and therefore, is eligible to claim deduction under section 10AA of the Act. The Assessing Officer, however, in the assessment order has wrongly proceeded under the impression that the business of the Assessee was development of software and export thereof, thereby computed deduction under section 10A instead of section 10AA of the Act. 3. The AO has recomputed deduction under section 10A of the Act by reducing travel expenses incurred in foreign currency amounting to Rs. 90,044,900 from the export tu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut prejudice to the above stand, the assessee submitted that any adjustment on account of said expenses from Export Turnover, should also be made from the Total Turnover for the purpose of computing deduction under section 10AA of the Act. The assessee submitted that parity should be maintained with regard to items of inclusions and exclusions between numerator and denominator, i.e., Export Turnover and Total Turnover, in the formula prescribed under section 10AA of the Act. The assessee placed reliance on the recent decisions of the of the Hon'ble High Court of Karnataka in the case of CIT Vs. Tata Elxsi (17 taxmann.com 100) (Kar.) wherein it was held that expenses should be reduced from the Total Turnover if the same is reduced from E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... export turnover they are also required to be proportionately reduced from the total turnover. This contention of the appellant is supported by the decision of the jurisdictional High Court in Tata Elxsi reported in 349 ITR 98, which has held as follows: "In other words, if the export turnover in the numerator is to be arrived at after excluding certain expenses, the same should also be excluded in computing the export turnover as a component of total turnover in the denominator. The reason being the total turnover includes export turnover. The components of the export turnover in the numerator and the denominator cannot be different. Therefore, though there is no definition of the term 'total turnover' in section 10A, there is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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