DCIT, BANGALORE vs. M/S SUZLON WIND INTERNATIONAL LTD.,, BANGALORE

This appeal by the revenue is directed against the order of the CIT(A)-III, Bangalore, dated 07/10/2014 for the assessment year 2010-11. The revenue has raised as many as 5 grounds of appeal but the only grievance is that the CIT(A) has erred in law in directing the AO to exclude reimbursement of expenses such as freight, telecommunication expenses, insurance incurred in M/s.Suzlon Wind International Ltd. Page 2 of 3 foreign currency, both from export turnover as well as total turnover for the purpose of computation of deduction u/s 10A of the Income-tax Act, 1961 [hereinafter referred to as 'the Act' for short] by following the decision of the Hon’ble Karnataka High Court in the case of Tata Elxsi Ltd.,reported in 349 ITR 98 even though the Department has not accepted the same and SLPs are pending before the Hon’ble Supreme Court. Learned Departmental Representative supported the order of the AO while the learned counsel for the assessee placed reliance upon the order of the jurisdictional High Court in the case of Tata Elxsi Ltd., (cited supra).

2. Having regard to the rival contentions and the material on record, we find that the issue is squarely covered in favour of the assessee by the decision of the jurisdictional High Court in the case of Tata Elxsi Ltd., (cited supra) wherein it has been held that if any expenditure is to be reduced from the export turnover then the same should also be reduced from the total turnover for the purpose of computation of deduction u/s 10A of the Act. Since the order of the CIT(A) is in consonance with the decision of the jurisdictional High Court, we see no reason to interfere with the same.

M/s.Suzlon Wind International Ltd. Page 3 of 3 3. In the result, the revenue’s appeal is dismissed.