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assessee informed that an identical issues are adjudicated by the Tribunal for the assessment year 2003-04.

20. Learned counsel for the assessee that the assessee develops computer software in synchronization with other development teams across the globe and requires to be networked with the other teams on a continuous basis. Further, the assessee has obtained the data link services from service providers. The communication charges are largely incurred for inter office and intra office communication (i.e. since the nature of the business of the assessee is such that it requires substantial interaction between the personnel of the assessee and personnel of other entities across the globe) in addition to being marginally incurred for export/delivery of computer software outside India. It is further pleaded that the assessee is remunerated on a cost plus basis of the export of computer software and does not recover the communication charges and insurance charges separately and there is no separate disclosure of the said expenditure under the service agreements or in the invoice/softex form. The communication and services charges are merely one of the components of the entire cost, which is being used to arrive at the revenue figure and the cost plus model is only a mechanism to arrive at the revenue. The CIT(A) held that the expenses should be reduced from the export turnover since the communication charges and insurance charges were incurred for export/delivery of computer software outside India. Of course, he reduced he reduced the said expenses both from the total turnover, having held that the same have to be reduced from the export turnover on principle of parity.