Turnover for the purpose of deduction U/S 10-B
This query is : Resolved
12 December 2009
In the case of 100% EOU, the assessee has not collected freight charges/insurance separately in the invoice. The AO wants to deduct the freight charges and insurance charges debited in the P & L A/C from the export turnover. Is he correct.
Kindly clarify
P. Srinivasa
Kindly clarify
P. Srinivasa
12 December 2009
By debiting to profit and loss account such expenses means you have not collected these payments from the customer. Hence this part will not be received in foreign exchange.
Explanation to Section 10B (9A) 2 (iii) -
It reads as under (with modifications and explanations as required by your question) :
"export turnover" means the consideration in respect of export by the undertaking of articles or things received in, or brought into, India by the assessee in convertible foreign exchange in accordance with sub-section 3 (payment to be received within 6 months), but does not include freight, telecommunication charges or insurance attributable to the delivery of the articles or things outside India ....
It means the expenditure which have been made outside India towards freight, telecommunication or insurance are not considered as export turnover. The logic behind is that we cannot export the expenses.
Simply, whatever you will receive from export turnover in the form of convertible foreign exchange is your export turnover.
ITO is not correct.
You may present the definition in the following form with suitable explanations (with facts of your case):
Convertible Foreign Exchange received is the Export Turnover. Export expenses alrady not included in the turnover hence there is no question of deduction from the invoice value.
CA Rakhecha
Surat
Explanation to Section 10B (9A) 2 (iii) -
It reads as under (with modifications and explanations as required by your question) :
"export turnover" means the consideration in respect of export by the undertaking of articles or things received in, or brought into, India by the assessee in convertible foreign exchange in accordance with sub-section 3 (payment to be received within 6 months), but does not include freight, telecommunication charges or insurance attributable to the delivery of the articles or things outside India ....
It means the expenditure which have been made outside India towards freight, telecommunication or insurance are not considered as export turnover. The logic behind is that we cannot export the expenses.
Simply, whatever you will receive from export turnover in the form of convertible foreign exchange is your export turnover.
ITO is not correct.
You may present the definition in the following form with suitable explanations (with facts of your case):
Convertible Foreign Exchange received is the Export Turnover. Export expenses alrady not included in the turnover hence there is no question of deduction from the invoice value.
CA Rakhecha
Surat
14 December 2009
The AO wants to reduce the Export turnover to the extent of expenses incurred on account of freight, telecommunication and insurance and is not agreeing for the similar reduction from total turnover.
Is there any case law decided by Karnataka High Court.
Is there any case law decided by Karnataka High Court.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- ITR 2 Short Term gain & Long term gain
- Off Market debit and credit transaction
- Itr 1 processing
- Reporting Income under Section 44ADA
- ITR validation error - Balance sheet is not filled
- ITR 1: Details for showing Exempt Income
- ITR returnFY25-26
- Short Term Capital gain on shares bought and sold after 2018 onwards
- INCOME TAX ON REDEVELOPEMENT OF FLAT
- Bank Accounts in Balance Sheet for ITR 3
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- Difference in tax comparison report
- Gst invoice numbering and delivery challan numbering
- Sales amount in Gstr1
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
