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| The Tax Publishers2020 TaxPub(DT) 3861 (Del-Trib) INCOME TAX ACT, 1961
Section 10AA
Profit derived from the unit situated at SEZ, engaged in business of trading activity in the nature of import and re-export of goods would fall within the definition of the term 'services' as defined in section 10AA. Consequently, the assessee was eligible for exemption under section 10AA towards export profit derived from eligible unit located at SEZ.
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Deduction under section 10AA - Undertaking in a free-trade zone - Undertaking being engaged in business of trading activity in the nature of import and re-export of goods -
Assessee-company was engaged in warehouse trading and storage activities. It was having a unit in SEZ and accordingly, the assessee claimed deduction under section 10AA. AO denied the said deduction on the ground that the SEZ undertaking of the assessee was engaged in business of trading in nickel and steel and therefore, it was outside the definition of 'entrepreneur' under SEZ Act. Assessee submitted that it fulfilled all the conditions of the SEZ Act and was also engaged in the 'services', which included trading and therefore, should be granted deduction under section 10AA. Held: Profit derived from the unit situated at SEZ, engaged in business of trading activity in the nature of import and re-export of goods would fall within the definition of the term 'services' as defined in section 10AA. Consequently, the assessee was eligible for exemption under section 10AA towards export profit derived from eligible unit located at SEZ.
REFERRED : Solitaire Diamond Exports v. ITO-19 (3) (4) (2020) 114 taxmann.com 176 (Mumbai-Trib.) : 2019 TaxPub(DT) 7612 (Mum-Trib) DCIT, Circle-2 (1), Guntur v. M/s. Bommidala Enterprises (P) Ltd. and ACIT, Circle-1 (1), Guntur v. M/s. Bommidala Enterprises (P) Ltd. and Vice-Versa (2017) 80 Taxmann.com 362 (Visakhapatnam) : 2017 TaxPub(DT) 1006 (Visakhapatnam-Trib)
FAVOUR : In assessee's favour
A.Y. : 2014-15
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