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ACIT, Circle-1, Udaipur Versus M/s. Advaiya Solutions Pvt. Ltd.

2016 (4) TMI 818 - ITAT JODHPUR

Disallowance of deduction under sec. 10B - Held that:- Departmental Representative could not point out any specific mistake in the order of the Commissioner of Income Tax (Appeals). Further, no material was brought on record by the Revenue to controvert the finding of the Commissioner of Income Tax (Appeals) that deduction under sec. 10B was all along allowed to the assessee since Assessment Year 2006-07 in an assessment completed under sec. 143(3) of the Act. We are alive to the fact that in in .....

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ll the conditions laid down in the provisions of sec. 10B(2)(i) & 10B(3) of the Act? - Held that:- Commissioner of Income Tax (Appeals) after considering the submissions of the assessee as well as remand report received from the Assessing Officer under sec. 250(4) of the Act wherein the Assessing Officer verified the date of receipts and opined that the sale proceeds of the computer software has been brought by the assessee within the extended period of 12 months by the Reserve Bank of India and .....

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R N.S. SAINI, ACCOUNTANT MEMBER This is an appeal filed by the Revenue against the order of Commissioner of Income Tax (Appeals)-1, Udaipur, dated 17/12/2014. 2. In ground No.1 of the appeal, the grievance of the Revenue is that the Commissioner of Income Tax (Appeals) erred in deleting the disallowance of deduction under sec. 10B of the Act on the ground that in preceding years, the issue of allowability of claim under sec. 10B of the Act was allowed therein ignoring that in income tax proceedi .....

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77; 66,79,007/- under sec. 10B of the Act. The Assessing Officer observed that the assessee company did not fulfil the conditions laid down in the Act for claiming exemption under sec. 10B of the Act, as the assessee company failed to give generic names of three principal products done by it with item code number. He, therefore, disallowed deduction under sec. 10B of the Act amounting to ₹ 66,79,007/- and added to the total income of the assessee. 4. On appeal, Commissioner of Income Tax ( .....

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ble for claiming deduction u/s.10B of the Act. Undisputedly, the appellant company came into existence during the previous year relevant to the assessment year 2006-07 as 100% Export Oriented Unit and filed its first return for the assessment year 2006-07 where deduction u/s.10B of the Act was claimed for the first time. The assessment for this year was completed u/s. 143(3) of the Act and while completing the assessment, the A.O. examined the eligibility and allowability of the claim for deduct .....

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ments u/s.. 143(3) for all the years. From the assessment order it is seen that the status of the appellant is 100% EOU and the profit has been earned on the same activities carried out by the appellant during the earlier assessment i.e. since its incorporation. Further, the reasons given by the A.O. for not allowing the deduction u/s.10B were already examined by the A.O. during the first assessment year in which the claim for deduction was claimed for the first time. Not only this, but the same .....

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10B of the Act and therefore, the disallowance made by the A.O. deserves to be deleted and I order accordingly. Thus, this ground of appeal is allowed. 5. Departmental Representative supported the order of the Assessing Officer, whereas the Authorized Representative of the assessee relied on the order of the Commissioner of Income Tax (Appeals). 6. We find that the Departmental Representative could not point out any specific mistake in the order of the Commissioner of Income Tax (Appeals). Furt .....

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not be altered without there being change in the facts requiring it to do so. Hence, we find no infirmity in the order of the Commissioner of Income Tax (Appeals), which is confirmed and the ground of appeal of the Revenue is dismissed. 7. In ground No.2 of the appeal, the grievance of the Revenue is that the Commissioner of Income Tax (Appeals) erred in deleting the disallowance of deduction under sec. 10B of the Act amounting to ₹ 40,18,276/- without appreciating the fact that the assess .....

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ing Officer had held that the assessee is not eligible for deduction under sec. 10B and the entire deduction claimed under sec. 10B was disallowed. The Assessing Officer did not make any separate addition, but held that no addition under sec. 10B is allowable to the extent of ₹ 49,90,065/- on account of failure on the part of the assessee to bring the sale proceeds inconvertible foreign exchange within the period mentioned above. 9. On appeal before the Commissioner of Income Tax (Appeals) .....

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software exported out of India are received in, or brought into, India by the assessee in convertible foreign exchange, within a period of six months from the end of the previous year or, within such further period as the competent authority may allow in this behalf. Explanation 1-For the purposes of this sub-section, the expression "competent authority" means the Reserve Bank of India or such other authority as is authorized under any law for the time being in force for regulating pay .....

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ments 6.12 Other entitlements of EOUIEHTPISTPIBTP units are as under: (a) Exemption from Income Tax as per Section 1 0A and 10B of Income Tax Act. (b) Exemption from industrial licensing for manufacture of items reserved for SSI sector. (c) Export proceeds will be realized within 12 months. (d) Units will be allowed to retain 1 00% of its export earning in the EEFC account. Copy of the Foreign Trade Policy 2009-2014 issued by the Reserve Bank of India is enclosed and marked herewith as Annexure .....

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as Annexure 8. That the convertible foreign exchange has been duly realized and repatriated in time prescribed in respect of the following invoices as under: S. No. Invoice Date Invoice Amount Date of repatriation. 1. 26/02/2010 11,78,865/- 08/11/2010 (Balance amount) 2. 31/03/2010 15,54,200/- 08/11/2010 3. 31/03/2010 22,57,000/- 08/11/2010 (Partial) 05/01/2011 (Balance) Total Amount 49,90,065/- As depicted in the above table, the convertible foreign exchange in respect of the 3 invoices has dul .....

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ppeals) allowed the appeal of the assessee by observing as under:- 4.3 I have considered the submissions of the appellant, findings of the A.O. given in the assessment order, the report of the A.O. received us 250(4) and the submissions of the appellant made on the said report. It is seen that during the period of reporting U/s.250(4), the A.O. has verified the date of receipts and opined that the sales proceeds of computer software has been brought by the appellant within the extended period of .....

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