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Income Tax Appellate Tribunal, “SMC-B” BENCH : BANGALORE
Before: SHRI A. K. GARODIA & SHRI GEORGE GEORGE K
This appeal at instance of department is directed against CIT(A) order dt:30.08.2016. The relevant assessment year is 2010 – 2011.
Grounds raised read as follows:
Brief facts of the case are as follows: 3.
Assessee is company, having 100% export oriented undertaking. For AY 2010-2011, The return of income was filed declaring total income of Rs.22,85,950/- after claiming exemption u/s 10B to the tune of Rs.3,64,07,920/-. The assessment u/s 143(3) was completed vide order dt 31.01.2013. In assessment completed, the AO recomputed deduction u/s 10B of the Act by excluding from Export Turnover, certain expenses without deducting the same from Total Turnover. The AO further held that deduction u/s 10B is to allowed only after setting off the brought forward losses.
Aggrieved, the assessee preferred on appeal to the First Appellate Authority. The CIT(A) allowed the appeal of the assessee. The CIT(A) followed the judgments of the Hon’ble Jurisdictional High Court in the case of CIT vs. Yokogawa India Ltd. (341 ITR 385) and CIT vs. Tata Elxsi (349 ITR 98).
Aggrieved, the revenue has filed the present appeal before the Tribunal, the learned DR relied on the grounds raised. The learned AR submitted that the issues raised are covered in favour of assessee by jurisdictional High Court Judgments, which has been relied on by the CIT (A).
I have heard rival submission and perused the material on record. The Hon’ble High court in the case of CIT vs Tata Elxsi (supra) has held that expenditure excluded from Export Turnover, has to be excluded from Export Turnover, has to be excluded also from the total turnover, while computing deduction u/s 10B of the Act. Further, The Hon’ble high court in the case of CIT vs Yokogawa India Ltd (supra) has held that deduction u/s 10B of the Act is to be computed, before setting off the forward loses. In view of above two judgments of the Hon’ble High court, I hold, CIT (A) is justified in allowing the appeal of the assessee. It is ordered accordingly.
In the result, the appeal of Department is Dismissed.
Order pronounced in the open court on 02-12-2016.