Sale proceeds’ in Sec 10A also means net proceeds if the goods are purchased from foreign buyers on credit and assessee is entitled to benefits u/s 10A

CIT, Bareilly Vs M/s Henna Zebraat (Allahabad High Court)- The assessee referred to the decision of Honourable Supreme Court in the case of J.B. Boda and Co. (P) Ltd Vs. CBDT, 223 ITR 271, according to which, if net proceeds are received in foreign exchange and credited then assessee would not be dis entitled from exemption.

The Tribunal relied upon judgement of the Supreme Court in J.B. Boda and Co. (P) Ltd Vs. CBDT, [1997] 223 ITR 271, in observing that if assessee receives net proceeds in foreign exchange then the deduction under Section 10-A of the Income Tax Act 1961, for promotion of exports, should not be denied.

High Court held that  Tribunal did not commit any error in finding that the principle of laid down in J.B. Boda’s case will be applicable, in the deduction of profits and gains from the business under Section 10 A of the Act. We further find that the words ‘sale proceeds’ in Section 10-A would, in the context also mean, net proceeds, if the goods were purchased from foreign buyers on credit. The explanation 1 and 2 to sub section (3) is not attracted in the present case.

HIGH COURT OF JUDICATURE AT ALLAHABAD

Case :- INCOME TAX APPEAL No. – 512 of 2009

Please become a Premium member. If you are already a Premium member, login here to access the full content.