9911796707
TMI Blog2017 (10) TMI 1517X X X X Extracts X X X X X X X X Extracts X X X X ..... as been passed in pursuant to the mutual agreement reached under the frame work agreement involving the international transactions. Thus the learned Counsel for the assessee has submitted that the TP grounds become infructuous and the assessee does not press these grounds of the assessee's appeal. 3. As regards the Ground Nos. 29 to 34, the Ld. Senior Counsel has submitted that due to smallness of the issue, the assessee does not press these grounds and the same may be dismissed. Accordingly, the appeal of the assessee is dismissed due to ground on TP adjustment being infructuous pursuant to the resolution of the dispute under MAP and the rest of the grounds are dismissed being not pressed. 4. The revenue has raised the following grounds: 1. The order of the Dispute Resolution Panel is opposed to law and the facts and circumstances of the case. 2. The DRP erred in directing the TPO to apply 25% employees cost filter uniformly to both the segment and to exclude M/s. Accropetal Technologies Ltd. from ITES segment without appreciating that the directions to the AO amounts to setting aside the issue which is outside the purview of the DRP under the provision of section 144C a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the DRP is not empowered to set aside the issue in terms of section 144C(8) of the Act. 9. The DRP erred in allowing relief to the assessees by not excluding the interest income earned on fixed deposits from the profit of the business for the purpose of computation of deduction u/s 10A by relying on the jurisdictional High court decision in the case of M/s. Motorola India Electronics Pvt. Ltd. (ITA N0.428 OF 2007 Dated 11.12.2013) without appreciating the fact that the assessee company is not 100% export oriented unit. 10. The DRP erred in directing the AO to follow the ratio laid down by the Hon'ble Court in the case of Tata Elxsi Limited 349 ITR 98 and exclude telecommunication expenses from the export turnover also while computing the deduction u/s. 10A of the I.T. Act, without appreciating the fact that there is no provision in section 10A that such expenses should be reduced from the total turnover also, as clause (iv) of the explanation to section 10A provides that such expenses are to be reduced only from the export turnover. 11. The DRP erred in not appreciating the fact that the jurisdictional High Court's decision in the case of Tata Elxsi Limited 349 ITR 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in from the sale of article, it is the income which is derived from the consideration realised by the export of article. Thus the definition of income from profit as per sub-section (4) was considered by the Hon'ble High Court and held that the interest is part of the income from profit and gain and therefore eligible for deduction under section 10A of the Act. The Ld. Senior Counsel has further submitted that the assessee is also a 100% EOU as it is clear from the turnover from export of the assessee. He has also relied upon the decision of Hon'ble jurisdictional High Court in the case of Caritor India (P.) Ltd. v. DCIT in [IT Appeal No.1125 of 2008, dated 14-10-2014] as well as decision dated 14.10.2014 of Hon'ble jurisdictional High Court in the case of CIT v. Rajesh Exports in [IT Appeal No.1/2009. The Ld. Senior Counsel has also relied upon the Hon'ble Kolkata High Court in the case of CIT v. Hindustan Gum & Chemicals Ltd. [2016] 72 taxmann.com 90. Thus the Ld. Senior Counsel has submitted that there is a distinguishing fact in the definition of income as per the provisions of Section 10A and Section 80HHC. Section 80HHC specifically excludes the interest from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this sub-section only for the unexpired period of aforesaid ten consecutive assessment years : Provided further that for the assessment year beginning on the 1st day of April, 2003, the deduction under this sub-section shall be ninety per cent of the profits and gains derived by an undertaking from the export of such articles or things or computer software: Provided also that no deduction under this section shall be allowed to any undertaking for the assessment year beginning on the 1st day of April, 2012 and subsequent years: Provided also that no deduction under this section shall be allowed to an assessee who does not furnish a return of his income on or before the due date specified under sub-section (1) of section 139. (4) For the purposes of sub-section (1), the profits derived from export of articles or things or computer software shall be the amount which bears to the profits of the business of the undertaking, the same proportion as the export turnover in respect of such articles or things or computer software bears to the total turnover of the business carried on by the undertaking." By Finance Act, 2001, with effect from 01.04.2001, the present sub-section (4) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39; incorporated in sub-section (4), the assessee is entitled to the benefit of exemption of the said amount as contemplated under section 10B of the Act. Therefore, the Tribunal was justified in extending the benefit to the aforesaid amounts also. We do not find any merit in these appeals. Therefore, the first substantial question of law raised in ITA No.428/2007 is answered in favour of the revenue and against the assessee and the first substantial question of law in ITA No.447/2007 is answered in favour of the assessee and against the revenue. In the light of the aforesaid findings, the second substantial question of law in both the appeals do not arise for consideration.' Thus the Hon'ble jurisdictional High Court has clearly taken note of the computation of income under section 80HHC and under Section10A/10B of the Act and then observed that the interest income though cannot be partake the character of profit and gain from the sale of article however, it is the income which is derived from the consideration realised by the export of articles. Therefore having considered the definition of income from profit and gain as envisaged in sub-section (4) of section 10B/10A ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
