The DCIT, (OSD), Circle-8, Ahmedabad V. M/s. Zydus Hospira Oncology Pvt. Ltd., Ahmedabad

ITA 2788/AHD/2014

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 7949 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 8 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 17-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH SINGH
• Assessee Lawyers: MUKESH M PATEL
• Keywords: Business income; Depreciation
• Section: 143(3); 10AA; 80HHC; 10

Judgement Text

, A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SMT. MADHUMITA ROY, JUDICIAL MEMBER ./ I.T.A. NO. 2788/AHD/2014 ( ASSESSMENT YEAR : 2010-11) D.C.I.T.(OSD), CIRCLE-8, AHMEDABAD / VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD., PLOT NO.3, PHARMEZ, SARKHEJ BVALA HIGHWAY, TA. MATODA, DIST. SANAND, AHMEDABAD-13 ./ ./ PAN/GIR NO. : AAACZ2327A ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI SAURABH SINGH, SR.D.R. / RESPONDENT BY : SHRI MUKESH M. PATEL, A.R. DATE OF HEARING 18/06/2018 !'# / DATE OF PRONOUNCEMENT 02/07/2018 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE REVENUE AGAINST THE ORDER OF THE CIT(A)-XIV, AHMEDA BAD (CIT(A) IN SHORT), DATED 04.07.2014 ARISING IN THE ASSESSME NT ORDER DATED 28.03.2014 PASSED BY THE ASSESSING OFFICER (AO) U/S . 143(3) OF THE INCOME TAX ACT, 1961 (THE ACT) CONCERNING ASSESSMEN T YEAR 2010-11. ITA NO. 2788/AHD/14 [DCIT(OSD) VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD.] A.Y. 2010-11 - 2 2. THE SUBSTANTIVE GROUNDS OF APPEAL RAISED BY REVE NUE READS AS UNDER: 1). WHETHER THE COMMISSIONER OF INCOME-TAX (APPEA LS) ERRED IN LAW AND ON FACTS IN ALLOWING DEPRECIATION @ 60% ON COMPUTER SOFTWARE PURCHASED SEPARATELY (SAP SOFTWARE) AGAINS T 25% APPLICABLE TO INTANGIBLE ASSETS IGNORING THE FINDIN GS OF AO'. 2). WHETHER THE COMMISSIONER OF INCOME-TAX (APPEAL S) ERRED IN LAW AND ON FACTS IN ALLOWING THE ASSESSEE'S CLAIM O F DEDUCTION U/S.10AA OF THE ACT ON EXCHANGE FLUCTUATION GAIN, W HICH IS NOT OF FIRST DEGREE AND NOT DERIVED FROM EXPORT. 3. GROUND NO.1 CONCERNS ELIGIBILITY OF DEPRECIATION ON COMPUTER SOFTWARE PURCHASES SEPARATELY BY THE ASSESSEE AT AN ACCELERATED RATE OF 60% CLAIMED BY THE ASSESSEE. IT IS CASE OF THE REVE NUE THAT DEPRECIATION ON THE COMPUTER SOFTWARE IS ELIGIBLE @ 25% AS APPLICABLE TO INTANGIBLE ASSETS INSTEAD OF CLAIM @60% MADE BY THE ASSESSEE. WHEN THE MATTER WAS CALLED FOR HEARING, THE LEARNED DR SUPPORTED THE ORDER OF THE AO AND CONTENDED THAT THE COMPUTER SOF TWARE HAS BEEN PURCHASED SEPARATELY AND IS IN THE NATURE OF APPLIC ATION SOFTWARE AND THEREFORE CANNOT BE CONSIDERED AS INTEGRAL PART OF THE COMPUTER SYSTEM. THIS BEING THE CASE, THE AO HAS CORRECTLY RESTRICTED THE DEPRECIATION ALLOWANCE @25% AS APPLICABLE TO INTANG IBLE ASSETS AND THE CIT(A) HAS MISDIRECTED HIMSELF IN LAW IN ADMITT ING THE DEPRECIATION CLAIM AT ACCELERATED RATE OF 60% WRONG LY CLAIMED BY THE ASSESSEE. 4. LEARNED AR, ON THE OTHER HAND, SUBMITTED AT THE OUTSET THAT THE ISSUE IS ACADEMIC OWING TO THE FACT THAT THE ASSESS EE IS AN UNDERTAKING ELIGIBLE FOR 100% EXEMPTION/DEDUCTION UNDER S.10A O F THE ACT AND HENCE ANY INCREASE IN PROFIT DUE TO LOWER DEPRECIAT ION WOULD LEAD TO CORRESPONDING HIGHER DEDUCTION UNDER S. 10A OF THE ACT IN TANDEM. IT WAS FURTHER ASSERTED THAT, NOTWITHSTANDING AFORESAI D CONTENTION, THE ASSESSEE IS ELIGIBLE FOR 60% CLAIM ON COMPUTER SOFT WARE AS CLAIMED. ITA NO. 2788/AHD/14 [DCIT(OSD) VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD.] A.Y. 2010-11 - 3 THE COMPUTER SOFTWARE SO INSTALLED ALBEIT SEPARATELY IS A LONG TERM SOFTWARE HAVING REGARD TO THE SPECIAL NEEDS OF THE ASSESSEE COMPANY. IT WAS SUBMITTED THAT WITHOUT SUCH SOFTWARE, THE CO MPUTER INSTALLED CANNOT BE USED AT DESIRED LEVEL HAVING REGARD TO TH E INDUSTRY IN WHICH THE ASSESSEE BY PLACED IN. THE LEARNED AR, THEREAF TER, POINTED OUT THAT THE ISSUE IS NO LONGER RES INTEGRA AND IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE CO-ORDINATE BENCH O F THE TRIBUNAL ACIT VS. ZYDUS INFRASTRUCTURE (P.) LTD. [2016] 72 T AXMANN.COM 199 (AHMEDABAD-TRIB.). LEARNED AR SUBMITTED THAT IN ON E OF GROUP CASES AS POINTED OUT, THE IDENTICAL ISSUE CAME UP WHEREIN IN SIMILAR FACTS, IT WAS HELD THAT ASSESSEE IS ELIGIBLE FOR ACCELERATED DEPRECIATION YEAR- AFTER-YEAR AND THEREFORE, HIGHER DEPRECIATION IN IN ITIAL YEARS WOULD ULTIMATELY LEAD TO LOWER DEPRECIATION IN THE SUBSEQ UENT YEARS AND ACCORDINGLY, OVER A PERIOD OF TIME, THE ENTIRE EXER CISE WOULD BE REVENUE NEUTRAL. THE LEARNED AR ACCORDINGLY ASSERT ED THAT NO INTERFERENCE WITH THE ORDER OF CIT(A) IS CALLED FOR . 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE FIND SUBST ANTIAL WEIGHT IN THE COUNTER PLEA RAISED ON BEHALF OF THE ASSESSEE FOR E LIGIBILITY OF ACCELERATED DEPRECIATION IS NOTED ABOVE. IN VIEW OF THE FACT THAT HIGHER OR LOWER DEPRECIATION WILL NOT LEAD TO ANY CHANGE I N TAXABLE INCOME OF THE 10-A UNIT, THE ENTIRE ISSUE IS ACADEMIC. SECON DLY, IN VIEW OF THE SIMILARITY IN FACTS, THE CONCLUSION DRAWN BY THE CI T(A) IS CONSISTENT WITH THE DECISION OF THE CO-ORDINATE BENCH IN ZYDUS INFRASTRUCTURE (P.) LTD. (SUPRA). THUS, WE DO NOT SEE ANY GOOD REASON TO INTERFERE WITH THE ORDER OF THE CIT(A). 6. IN THE RESULT, GROUND NO.1 OF THE REVENUES APPE AL IS DISMISSED. ITA NO. 2788/AHD/14 [DCIT(OSD) VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD.] A.Y. 2010-11 - 4 7. GROUND NO.2 CONCERNS ELIGIBILITY OF FOREIGN EXCH ANGE FLUCTUATION GAINS FOR THE PURPOSES OF EXEMPTION UNDER S.10A OF THE ACT. 8. BRIEFLY STATED, IN THE COURSE OF SCRUTINY ASSESS MENT, THE AO INTER ALIA OBSERVED THAT THE ASSESSEE HAS CLAIMED DEDUCTION UN DER S.10AA IN RESPECT OF EXCHANGE RATE FLUCTUATION GAINS OF RS.3, 15,33,058/-. THE AO WAS OF THE VIEW THAT THE AFORESAID FLUCTUATION G AINS DOES NOT FALL WITHIN THE SWIP OF EXPRESSION DERIVED FROM WHICH IS A CONDITION PRECEDENT FOR ELIGIBILITY OF PROFITS AS CONTEMPLATE D IN SECTION 10AA(1) OF THE ACT. IT WAS THE CASE OF THE AO THAT THE FOR EIGN EXCHANGE FLUCTUATION GAINS IS MERELY ATTRIBUTABLE TO EXPOR T IN DISTINCTION TO THE EXPRESSION DERIVED FROM AS PROVIDED IN SECTION 10 AA(1) OF THE ACT. IN ESSENCE, IT IS THE CASE OF AO THAT THE FLUCTUATI ON GAINS IS NOT DERIVED FROM EXPORT OF ARTICLES OR THINGS ETC. PER SE BUT IS MERELY ATTRIBUTABLE TO PROFITS AND GAINS FROM EXPORT AND C ONSEQUENTLY NOT ELIGIBLE FOR DEDUCTION UNDER S.10AA OF THE ACT. TH E AO ACCORDINGLY DENIED CLAIM OF DEDUCTION UNDER S.10AA OF THE ACT I N RESPECT OF BUSINESS PROFITS BY WAY OF FOREIGN EXCHANGE FLUCTUA TION GAINS. 9. THE CIT(A), IN FIRST APPEAL, REVISITED THE ENTIR E ISSUE AT LENGTH. THE CIT(A) TOOK NOTE OF THE PROVISIONS OF SECTION 1 0AA(7) OF THE ACT WHICH PROVIDES FOR THE MANNER IN WHICH THE PROFITS DERIVED FROM EXPORTS OF ARTICLES OR THINGS ETC. UNDER S. 10AA(1) OF THE ACT IS REQUIRED TO BE COMPUTED. THE CIT(A) ALSO TOOK NOTE OF THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. P RIYANKA GEMS (2014)367 ITR 575 (GUJ) AND ALSO THE DECISION OF HO NBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. AMBER EXPORT (IND IA) AND CONCLUDED THE ISSUE IN FAVOUR OF THE ASSESSEE. THE RELEVANT OPERATIVE PART OF THE ORDER OF THE CIT(A) IS REPRODUCED HEREUNDER: ITA NO. 2788/AHD/14 [DCIT(OSD) VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD.] A.Y. 2010-11 - 5 I AM INCLINED WITH APPELLANT. FIRSTLY THE APPELLAN T IS FOLLOWING A CONSISTENT METHOD OF ACCOUNTING SUCH FO REIGN EXCHANGE FLUCTUATION AS PER ACCOUNTING STANDARD AS-II AND TA X AUDITOR HAS NOT MADE ANY ADVERSE REMARKS. THE APPELLANT SUBMITTED T HAT IT FULFILLED ALL THE ELIGIBLE CONDITION TO CLAIM DEDUCTION U/S.1 0AA OF THE ACT FOR ITS ELIGIBLE UNIT IN SPECIAL ECONOMIC ZONE(SEZ). TH E APPELLANT THOUGH REDUCED SUCH GAIN FROM THE EXPORT TURN OVER BUT THE SAME WAS INCLUDED AS BUSINESS INCOME / PROFIT OF ELIGIBLE UN DERTAKING THEREBY CORRECTLY FOLLOWED THE PROVISIONS. AS PER PROVISION S IT IS PROFIT & GAINS OF ELIGIBLE UNIT AT SEZ FROM THE EXPORT OF GO ODS/ARTICLE/SERVICES AND THE SAME BE REALIZED IN FOREIGN EXCHANGE. IT IS UNDISPUTED THAT ON ACCOUNT OF DAY TO DAY FLUCTUATION OF FOREIGN EXC HANGE, SUCH VARIATION IN REPORTING OF SALE AS PER INVOICE AND R EALIZATION OF SUCH EXPORT BEING IN TWO DIFFERENT TIME FRAMES WILL RESU LT INTO SUCH GAIN OR LOSS. I AM INCLINED WITH APPELLANT THAT AS PER THE RATIO OF HON'BLE GUJARAT HIGH COURT DECISION IN THE CASE OF PRIYANKA GEMS UPHOLDING THE HON'BLE ITAT, AHMEDABAD ORDER IN THE SAME CAS E, SUCH GAIN AND LOSS ARE PART AND PARCEL OF THE SALE OF EXPORT. I AM ALSO INCLINED WITH APPELLANT THAT HON'BLE BOMBAY HIGH COURT FOR S AME ISSUE AND IN SIMILAR FACTS (DEDUCTION U/S.10A OF THE ACT) FOL LOWING ITS JUDGEMENT IN THE CASE OF CIT VS. AMBER EXPORT (INDI A) & HON'BLE GUJARAT HIGH COURT JUDGEMENT IN THE CASE OF CIT VS. AMBA IMPEX (2006) 282 ITR 144 HELD IN FAVOUR OF ASSESSEE FOR L ARGE AMOUNT REALIZED IN TERMS OF INDIAN RUPEES AS A RESULT OF A FOREIGN EXCHANGE FLUCTUATION THAT TOOK PLACE IN THE COURSE OF THE EXPORT TRANSACTION. SIMILARLY HON'BLE MUMBAI ITAT IN THE CASE OF RENAISSANCE JEWELLERY (P)LTD. (SUPRA) AFTER CONSIDE RING RATIO OF VARIOUS CASE LAWS HELD THAT- 'THERE IS NO MATERIAL DIFFERENCE BETWEEN THE REQUIR EMENT OF SECTION 80HHC AND SECTION 10A. THE PROFIT ON ACCOUNT OF FOR EIGN EXCHANGE GAIN IS DIRECTLY REFERABLE TO THE ARTICLES AND THIN GS EXPORTED BY THE ASSESSEE. SUCH PROFITS ARE, THEREFORE, IN THE SAME NATURE AS THE SALE PROCEEDS AND THERE IS NO REASON WHILE DEDUCTION UND ER SECTION 10A SHOULD NOT BE ALLOWED IN RESPECT OF SUCH EXCHANGE G AIN.' TWO IMPORTANT ASPECTS IN THIS REGARDS R EQUIRED TO BE CONSIDERED. (A) THE INTENTION OF LEGISLATURE WITH PURPOSE OF TH IS SECTION IS TO PROMOTE EXPORT AND FOREIGN EXCHANGE EARNINGS. (B) THERE MAY BE VARIOUS ACCOUNTING STANDARD TO RECORD A PARTICULAR TRANSACTION IN THE BOOKS OF ACCOUNTS BUT ULTIMATE NATURE OF SUCH TRANSACTION WILL BE CONSIDERED FOR T HE PHRASE 'DERIVED FROM.' IN THIS REGARD, IT IS UNDISPUTED THAT APPELLANT REA LIZED FOREIGN EXCHANGE ON ACCOUNT OF EXPORT FROM ELIGIBLE UNIT AT SEZ. FURTHER IN VALUE TERMS THERE ARE TWO ENTRIES I.E. ENTRY OF SAL E ON THE DATE OF ITA NO. 2788/AHD/14 [DCIT(OSD) VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD.] A.Y. 2010-11 - 6 EXPORT AS PER INVOICE AND ENTRY OF GAIN / LOSS ON A CCOUNT OF REALISATION OF SUCH SALE. THERE IS NO OTHER ACTIVIT Y OF SALE OR SERVICES BUT IT IS ON ACCOUNT OF TWO DIFFERENT VALUE OF FORE IGN CURRENCY FOR TWO DIFFERENT TIME FRAMES RELATED TO ONE SALE, HENCE SU CH GAIN / LOSS IS PART AND PARCEL OF SALE AND PROFIT / INCOME OF THE ELIGIBLE UNIT ENTITLED FOR DEDUCTION U/S.10AA OF THE ACT. HON'BLE ITAT, AHMEDABAD 'A' BENCH IN THE CASE OF M/ S.ZAVERI & CO. PVT. LTD. VS. CIT-IV, AHMEDABAD IN ITA NO.139 5/AHD/2013 & ITA NO.1396/AHD/2013 VIDE ORDER DATED 07.05.2014 CO NSIDERED THE ISSUE OF BUSINESS INCOME OF ELIGIBLE UNIT AND CLAIM OF DEDUCTION THOUGH IN REFERENCE TO DIFFERENT GROUNDS AS FOLLOWS : SINCE THE FOREIGN EXCHANGE FLUCTUATION GAIN OR LOS S IS IN INDIAN RUPEES BEING REALIZED AS PER EXCHANGE RATE, PROVISIONS OF SECTION 10AA (7) OF THE ACT WHICH PROVIDE THE MANNE R IN WHICH THE PROFITS DERIVED FROM 'EXPORT OF ARTICLES OR THINGS OR SECURITIES IS TO BE COMPUTED FOR THE PURPOSE OF 10AADEDUCTION REFLEC T THAT- THE PROFITS OF THE BUSINESS OF THE UNDERTAKING ARE TO BE COMPUTED AS PER THE PROVISIONS OF CHAPTER IV D OF THE ACT AND T HE ONLY ADJUSTMENT WHICH IS PERMITTED BY THE LEGISLATURE TO BE MADE TO SUCH PROFITS OF THE BUSINESS IS TO APPORTION THE SAME IN THE PROPORTION OF EXPORT TURNOVER OF THE ELIGIBLE SERVICES TO THE TOTAL TURN OVER OF THE BUSINESS CARRIED ON BY THE ASSESSEE. IT IS SIGNIFICANT TO NO TE HERE THAT THE SPECIFIC PROVISIONS LIKE EXPLANATION (BAA) OF SECTI ON 80HHC OF THE ACT WHICH PROVIDE FOR EXCLUSION OF 90% OF INTEREST INCOME FROM THE PROFITS OF BUSINESS TO ARRIVE AT THE PROFITS OF THE BUSINESS HAS NOT BEEN PROVIDED BY THE LEGISLATURE IN SECTION 10AA OF THE ACT.' IN THE PRESENT CASE OF APPELLANT, SUCH GAINS WERE R EDUCED FROM THE EXPORT TURNOVER BUT NOT FROM THE PROFIT / BUSIN ESS INCOME OF THE ELIGIBLE UNIT AS PER THE PROVISIONS OF SECTION 10AA (7) OF THE ACT BUT A.O. REDUCED SUCH GAIN FROM THE BUSINESS PROFIT ALS O. IT IS THEREFORE SUCH INTERPRETATION OF A.O. AND GIVING EFFECT TO TH ESE GAIN BY COMPLETELY EXCLUDING FROM DEDUCTION U/S.10AA OF THE ACT IS NEITHER JUSTIFIED BEING NOT AS PER THE PROVISION NOR SUSTAI NABLE IN VIEW OF VARIOUS LEGAL PROPOSITIONS AS DISCUSSED ABOVE AND A LSO RELIED ON BY APPELLANT. THE AO IS DIRECTED NOT TO REDUCE RS.2,32,88,197 FOREIGN EXCHANGE GAIN FROM PROFITS OF BUSINESS WHILE COMPUTING DEDUCTION U/S.10AA OF THE ACT. THE APPELLANT ALREAD Y REDUCED THE SAME FROM EXPORT TURNOVER. THE AO AT PARA 4.12 OF T HE IMPUGNED ORDER COMPUTED DEDUCTION U/S.10B (WRONGLY MENTIONED , IT SHOULD BE 10AA) OF THE ACT BY INCREASING BUSINESS PROFIT WITH REFERENCE TO DISALLOWANCE OF DEPRECIATION AND DECREASING BUSINES S PROFIT WITH REFERENCE TO FOREIGN EXCHANGE GAIN AT RS.33,03,05 ,531 AND DISALLOWED EXCESS CLAIM OF DEDUCTION U/S.10AA OF THE ACT OF RS.2,14,08,877 (35,17,14,408 - 33,03,05,531) BUT NOW CONSIDERING THE RELIEF GRANTED FOR DEPRECIATION AT PARA 5.1 ABO VE AND TREATING ITA NO. 2788/AHD/14 [DCIT(OSD) VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD.] A.Y. 2010-11 - 7 SUCH GAIN AS PART OF BUSINESS PROFIT, THE APPELLANT 'S CLAIM U/S.10AA OF THE ACT WILL BE WORKED OUT AT RS.35,17, 14,408. THE AO IS DIRECTED TO ALLOW SUCH DEDUCTION. THIS GROUND IS TH EREFORE TREATED AS ALLOWED. 10. AGGRIEVED BY THE REVERSAL OF THE ACTION OF THE AO, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 11. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS ON THE ISSUE AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW. W E HAVE NO HESITATION IN ENDORSING THE VIEW OF THE CIT(A) IN T HIS REGARD. THE ISSUE IS SUBSTANTIALLY COVERED IN FAVOUR OF THE ASS ESSEE BY THE DECISION OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF PR IYANKA GEMS (SUPRA) AND CIT VS. GEM PLUS JEWELLERY INDIA LTD. [ 2010] 194 TAXMAN 192 (BOM.). THE ISSUE IS ALSO SETTLED IN FA VOUR OF THE ASSESSEE BY LONG LINE OF JUDICIAL PRECEDENTS WHERE A CONSISTENT VIEW HAS BEEN TAKEN THAT FOREIGN EXCHANGE GAINS ARISING OUT OF THE FLUCTUATION IN THE RATE OF FOREIGN EXCHANGE CANNOT BE DIVESTED FROM THE EXPORT BUSINESS OF THE ASSESSEE. ONCE EXPORT IS MA DE, THE FOREIGN EXCHANGE GAINS/LOSS MAY OCCUR DUE TO VARIETY OF REA SONS AT THE TIME OF REMISSION OF EXPORT SALE PROCEEDS. IN THIS VIEW OF THE MATTER, THE FOREIGN EXCHANGE FLUCTUATION GAINS REQUIRED TO BE T AKEN AS INTEGRAL PART OF THE BUSINESS PROFITS DERIVED FROM EXPORTS. EVEN, INDEPENDENTLY, IN SO FAR AS SECTION 10AA OF THE ACT IS CONCERNED, SUB- SECTION 7 THEREOF EXPLICITLY EXPLAINS THE TERM PRO FIT DERIVED FROM THE EXPORT OF ARTICLES OR THINGS TO MEAN THE AMOUNT WH ICH BEARS TO BE PROFITS OF THE UNDERTAKING, THE SAME PROPORTION A S THE EXPORT TURNOVER BEARS TO THE TOTAL TURNOVER OF THE BUSINES S CARRIED ON BY THE UNDERTAKING. THUS, WHAT IS REQUIRED TO BE DETERMIN ED IS PROFITS OF THE BUSINESS OF THE UNDERTAKING WHICH IS OSTENSIBLY WI DER THAN PROFITS & GAINS DERIVED BY THE UNDERTAKING. IN SHORT, THE P ROFITS DERIVED FROM EXPORT HAVE BEEN EQUATED WHEN BUSINESS PROFITS OF T HE UNDERTAKING IN ITA NO. 2788/AHD/14 [DCIT(OSD) VS. M/S. ZYDUS HOSPIRA ONCOLOGY PVT. LTD.] A.Y. 2010-11 - 8 VIEW OF THE FORMULA PROVIDED IN SECTION 10AA(7) OF THE ACT. IN VIEW OF THE AFORESAID DISCUSSION, WE DO NOT SEE ANY INFI RMITY IN THE CONCLUSION DRAWN BY THE CIT(A) IN FAVOUR OF THE ASS ESSEE AND AGAINST THE REVENUE. WE, THUS, DECLINE TO INTERFERE. 12. IN THE RESULT, GROUND NO.2 OF THE REVENUES APP EAL IS DISMISSED. 13. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. SD/- SD/- (MADHUMITA ROY) (PRADIP K UMAR KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 02/07/2018 TRUE COPY S. K. SINHA !'#' / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 56) / DR, ITAT, AHMEDABAD 7. 289 : / GUARD FILE. BY ORDER / 4 /5 *+#4 56) THIS ORDER PRONOUNCED IN OPEN COURT ON 02/07/20 18