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| The Tax Publishers2020 TaxPub(DT) 4142 (Karn-HC) INCOME TAX ACT, 1961
Section 10B
Section 10A covers newly established undertaking in Free Trade Zones whereas section 10B deals with newly established 100% EOU, Since assessee was a manufacturing unit and was 100% EOU as was found by Tribunal in order and had manufactured precision components and had exported the same through a company which had received the export proceeds in convertible foreign currency, therefore, assessee was entitled to the benefit of deduction under section 10B.
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Deduction under section 10B - 100% EOU - Assessee exporting through some other company - That other company realised proceeds in foreign exchange
Assessee was engaged in business, manufacture and exports of automotive components. The return of income was selected for scrutiny and AO passed an order determining the taxable total income of assessee. AO also held that though assessee had exported the goods but it did not realize export proceeds in convertible foreign currency as mandated under section 10B(3) and the same was realized in convertible foreign currency by a third party. AO, therefore, disallowed the claim of deduction of the assessee under section 10B. Held: Section 10A deals with Free Trade Zone (FTZ) unit whereas, section 10B deals with 100% EOU. Section 10A covers newly established undertaking in Free Trade Zones, whereas section 10B deals with newly established 100% EOU. Section 10A was introduced to give effect to EXIM policy of Central Government. In instant case, assessee was a manufacturing unit and was 100% EOU as was found by Tribunal in order. Assessee had manufactured precision components and had exported the same through M/s. T which had received the export proceeds in convertible foreign currency. Therefore, assessee was entitled to benefit of deduction under section 10B.
Relied:Ramnath & Co. v. CIT (2020) 116 taxmann.com 885 (SC) : 2020 TaxPub(DT) 2447 (SC) JB. Boda And Company Private Limited v. Central Board Of Direct Taxes 1997 TaxPub(DT) 0851 (SC) M/s. Granite Mart Limited v. ITO [ITA No. 28/2011 Dated 19-3-2020] : 2020 TaxPub(DT) 2134 (Karn-HC) The Pr. CIT v. International Stones India Pvt. Ltd. (2018) 94 Taxmann.Com 287 Karntaka : 2018 TaxPub(DT) 4058 (Karn-HC) M/s. Tata Elxsi Limited v. ACIT [ITA NO.411/2008] : 2015 TaxPub(DT) 5191 (Karn-HC) DCIT v. Metal Closures Pvt. Ltd. (2019) 102 Taxman.Com 72 (SC) : 2019 TaxPub(DT) 0299 (SC)
REFERRED :
FAVOUR : In assessee's favour
A.Y. : 2009-10
IN THE KARNATAKA HIGH COURT
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