TMI Blog2021 (3) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... ould also be excluded from the computation of business income. In this regard, we are in complete agreement with the submissions of the Ld. Authorized Representative. If the net foreign exchange of gain of ₹ 4,80,613/- is excluded from the computation of claim of deduction u/s 10A of the Act for the reason that it is on capital account, the same should also not be included while computing the net profit of the assessee. The same is directed to be excluded from the computation of business income as well. Accordingly, the additional ground raised by the assessee stands allowed. - ITA No. 6173/Del/2015 - - - Dated:- 25-2-2021 - SHRI N. K. BILLAIYA , ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA , JUDICIAL MEMBER Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pricing but upheld the net exclusion by the Assessing Officer of ₹ 4,80,613/- while computing the exemption u/s 10A. 2.1 Aggrieved, the assessee has now approached the Tribunal and has raised the following grounds of appeal: 1. Whether under the facts and circumstances of the case and in law, the learned CIT(A)-44, New Delhi was justified in upholding the findings of the AO as below- Disallowing Foreign Exchange Fluctuation (Cr.) ₹ 4,80,613/- (Net) for the purpose of calculating deduction u/s. 10A in view of the restrictions under the provisions of sec.10A(4) of the Act, considering the same as of capital nature and at the same time charged to tax as business income. 2. The appellant craves to be allowed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he additional ground should be allowed. 4.0 The Ld. Sr. Departmental Representative (DR) had no objection to admitting the additional ground. 5.0 Having heard both the parties we admit the additional ground as raised by the assessee as the ground relates to Ground No.1 of the original appeal memo and no fresh issue is being raised in this additional ground. 6.0 The Ld. Authorized Representative submitted a chart that depicted the working of foreign exchange fluctuation loss/gain. This chart is reproduced herein under for a ready reference: Working of exchange fluctuation loss/gain Realized Total Remarks EC Net Loa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder wherein the Ld. CIT (A) has given a categorical finding that this foreign exchange fluctuation adjustments were not related to the acquisition of assets and, therefore, section 43A (1) of the Act was not applicable. The Ld. Authorized Representative submitted that the Assessing Officer had relied on provision of section 43A and had concluded that the net amount of ₹ 4,80,613/- being capital in nature was not to be considered for the purposes of deduction u/s 10A of the Act. The Ld. Authorized Representative submitted that the provisions of section 43A (1) of the Act are applicable only where there is an increase or decrease in the liability of the assessee specifically for the purposes of acquiring the assets and, therefore, this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it being the net foreign exchange gain, for the reason that the same was capital in nature. There is no dispute that the said income is capital in nature as the Ld. CIT (A) has given a categorical finding on the same. The Department has not disputed it and neither is the assessee challenging it. The only prayer of the assessee is that if the same is not included in the net profit of the undertaking for the purposes of computation of claim of deduction u/s 10A of the Act, the same should also be excluded from the computation of business income. In this regard, we are in complete agreement with the submissions of the Ld. Authorized Representative. If the net foreign exchange of gain of ₹ 4,80,613/- is excluded from the computation of c ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
