Case Law Details
Brief of the case:
ITAT held in ITO Vs M/s.Last Peak Data Pvt. Ltd that if the assesse was an existing recognized Software Technology Park (STP) then it would be considered at par at of Special Economic Zone(SEZ) and exemptions available to SEZ would also be available to STP also because the purpose of incorporating the SEZ act of the inflow of foreign exchange was also fulfilled by STP. So for calculating the book profits u/s 115JB, the profits of STP was to be deducted because as per sec 115JB(6) profits related to the SEZ was not to be considered for calculation of book profits u/s 115JB so in the same way profits earned by the STP was also not to be considered.
Moreover to claim deduction for SEZ, physical presence of the unit in the special economic zone area was not mandatory because as per the definition of SEZ an existing unit before the commencement of SEZ act was also eligible but that particular existing unit must fulfill the purpose for which SEZ was enacted, So as STP was fulfilling the purpose as said above of net foreign exchange So all the special economic benefits which were available to SEZ should also be available to STP also.
Further the expenses incurred for the converting reserves of the company into the capital was a revenue expense not capital expense.
Further Interest on call money was to be taxed under head PGBP because the same was generated only of the business transactions.
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