INCOME TAX ACT, 1961

Section 10A

Deduction under section 10A - Computation of total turnover - Expenditure in foreign exchange -

Issue arose for consideration as to whether Tribunal was right in holding that the expenditure in foreign exchange was to be excluded from both export turnover and total turnover while computing eligible deduction under section 10A.Held: Following the decision in case of CIT-III, Chennai. v. SRA Systems Ltd. TCA. No. 975 of 2010 : 2021 TaxPub(DT) 1688 (Mad-HC), it was held that expenditure in foreign exchange was to be excluded from both export turnover and total turnover while computing eligible deduction under section 10A and accordingly appeal of assessee was allowed.

Followed:CIT, Central-III v. HCL Technologies Ltd. (2018) 93 Taxmann.com 33 (SC) : 2018 TaxPub(DT) 2138 (SC), CIT & Anr. v. Yokogawa India Ltd. 2016 TaxPub(DT) 5139 (SC), Textile Machinery Corporation Limited v. CIT (1977) 107 ITR 195 (SC) : 1977 TaxPub(DT) 805 (SC), CIT--III Chennai. v. SRA Systems Ltd. T.C.A. No. 975 of 2010 : 2021 TaxPub(DT) 1688 (Mad-HC), CIT v. S.R.A. Systems Ltd. [T.C.A.Nos.1470 to 1472 of 2010, dt. 19-1-2021], Comstar Automative Technologies Private Ltd., (Formerly known as Visteon Powertrain Control Systems India Private Limited) v. Dy. CIT Company Circle--I (3), Chennai [T.C.A. No. 228 of 2011] : 2020 TaxPub(DT) 1737 (Mad-HC), CIT, Chennai v. Sak Soft Ltd. [T.C.A. Nos. 1257 & 1258 of 2009 Order, dated 10-1-2019], CIT Chennai III v. S.R.A. Systems Ltd. 2019 TaxPub(DT) 887 (Mad-HC) and Asstt. CIT, v. Mizpah Publishing Services (P) Ltd. [I.T.A.Nos.2124 to 2126/Mds/2015, dt. 31-12-2015].

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2006-07

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