Law:

Section:

Section 10B of the Income-tax Act, 1961 - Export oriented undertaking - Assessment year 1999-2000 - Assessee-company which had commenced production prior to 1-4-1994 could claim exemption under section 10B, even if its export was less than 75 per cent of total sales [In favour of assessee] The assessee had commenced production prior to 1-4-1994 and its export was less than 75 per cent. The Assessing Officer held that the assessee was not entitled to exemption under section 10B as the assessee had not satisfied the conditions mentioned in section 10B. Held that the units, which were established prior to 1st April, 1994 had the advantage of claiming this exemption under section 10B even by exporting a fraction of their production. This mischief was sought to be avoided by amendment by prescribing 75 per cent as the level of exports, which had to be satisfied by the assessee. In that view of the matter, by a wrong interpretation, the Assessing Officer had disallowed the exemption. M.V. Seshachala for the Appellant. S. Parthasarathi for the Respondent. JUDGMENT N. Kumar, J. - These four appeals are preferred by the Revenue in respect of four assessment orders. Though, there are four separate assessment orders, the reasoning given by the AO is the same, which has now been set aside by the Tribunal. Accordingly, all the appeals are taken up together for consideration and disposed of by this common order. 2. The assessee is a company engaged in the business of development and export of software. It is a joint venture of HAL and British Aerospace. The assessee filed its return of income for the asst. yr. 1999-2000 declaring a total income and claiming exemption under s. 10B of various amounts in each of the assessment orders. The AO has disallowed the exemption under s. 10B on the ground that the assessee has commenced production much prior to 1st April, 1994 i.e., before s. 10B was amended by the Finance Act, 1994 which came into effect from 1st April, 1994. As the assessee does not satisfy the requirement mentioned in the section, he is not entitled to exemption. Aggrieved by the said order of the AO, the assessee preferred an appeal before the CIT(A) who set aside…

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