As per sec 10A eligible business is to be treated as separate entity if the transfer made from an unrelated party

Last updated: 02 April 2012

Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
section 10A, the eligible business (appellant’s branch office in this case) is to be considered as a separate entity and transfer of goods or services by eligible business to/from other business of the assessee are to be treated as if such transfer has been made to/from an unrelated third party. Therefore, supply of software by appellant’s branch office to appellant’s head office is to be considered as export to an unrelated third party and profits derived by appellant from such export are eligible for exemption u/s 10A of the Act. 8. In view of the discussion above and respectfully following the orders of the ITAT, the AO is directed to allow the claim of the appellant in respect of exemption u/s 10A on account of software supplied by it to its parent entity in USA.

Citation :
Jt. Director of Income-tax,International Taxation,Circle-2(2),New Delhi(Appellant)V/s. M/s Virage Logic International(India Branch Of f ice), A-75,Sector -57, Noida (U.P.)[PAN: AABCV 8275 E] (Respondent)