TMI Blog2020 (8) TMI 767X X X X Extracts X X X X X X X X Extracts X X X X ..... t turnover' does not include any expenses incurred in foreign exchange in providing technical services outside India. The assessee has incurred expenditure in foreign currency from export turnover for software development. Similarly, the telecommunication charges attributable to delivery of computer software outside India could not have been excluded from the export turnover in view of Explanation 1(i) to Section 10AA of the Act. It is also noteworthy that Explanation 2 to Section 10AA provides that profits and gains derived from; on site development of computer software (including services for development of software) outside India shall be deemed to be the profits and gains derived from the export of computer software outside India. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0AA of the IT Act when the Appellant is engaged in software development? (ii) Whether on the facts and in the circumstances of the case, the Honourable ITAT was right in upholding the action of the Learned Respondent in excluding telecommunication charges of ₹ 3,70,62,460/- from export turnover under Section 10B and Section 10AA of the IT Act when the same represented payment made for standard facility? (iii) Whether on the facts and in the circumstances of the case, the Honourable ITAT was right in upholding the action of the learned respondent in excluding expenditure of ₹ 198,17,58,814/- incurred in foreign currency from export turnover under Section 10B and Section 10AA of the IT Act when the appellant is engaged i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) by an order dated 03.02.2012 partly allowed the appeal. Being aggrieved, the assessee as well as the revenue filed appeals before the Income Tax Appellate Tribunal (hereinafter referred to as 'the Tribunal', for short). The Tribunal vide order dated 11.01.2013 dismissed the appeal preferred by the assessee. In the aforesaid factual background, the assessee has filed this appeal. 3. Learned counsel for the parties at the outset submitted that substantial question of law Nos. III and V in substance arise for consideration in this appeal. 4. It is submitted by learned counsel for the assessee that assessee had incurred expenditure of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er dated 11.05.2016 passed in I.T.A.Nos.1328, 1347/bang/2011 and 1391/bang/2013. Thereafter, an order was passed on 31.01.2017 by which the order of the Tribunal was given effect to. It is further submitted that substantial questions of law involved in this appeal are no longer res integra and have been answered by a division bench of this court in I.T.A.No.42/2008 vide judgment dated 20.10.2014. The aforesaid order was upheld by the Supreme Court vide order dated 22.02.2019. Reliance has been placed on decisions of this court in 'COMMISSIONER OF INCOME-TAX, BANGALORE VS. MPHASIS LTD.', (2016) 74 TAXMANN.COM 274 (KARNATAKA) which has been upheld by Supreme Court vide order dated 13.11.2019 passed in SLP(C)No.766/2015. Reference has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t does not include:- (a) Freight, telecommunication charges or insurance attributable to the delivery of the articles or things or computer software outside India. or (b) Expenses, if any, incurred in foreign exchange in providing the technical services outside India. 7. From perusal of aforesaid provision, it is evident that expression 'export turnover' does not include any expenses incurred in foreign exchange in providing technical services outside India. Explanation 1(i) to Section 10AA and Explanation 2 to Section 10AA read as under: export turnover means the consideration in respect of export by the undertaking, being the Unit of articles or things or services received in, or brought into, In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0B of the Act, the expression 'export turnover' does not include any expenses incurred in foreign exchange in providing technical services outside India. The assessee has incurred expenditure of ₹ 198,17,58,814/- in foreign currency from export turnover for software development. Similarly, the telecommunication charges attributable to delivery of computer software outside India could not have been excluded from the export turnover in view of Explanation 1(i) to Section 10AA of the Act. It is also noteworthy that Explanation 2 to Section 10AA provides that profits and gains derived from; on site development of computer software (including services for development of software) outside India shall be deemed to be the profits and ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
