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2014 (12) TMI 353 - GUJARAT HIGH COURTExclusion of sales tax and excise duty for computation of total turnover u/s 80HHC - Whether the Tribunal was right in upholding the order of the CIT(A) directing to exclude sales-tax and excise duty while computing total turnover for the purpose of deduction u/s. 80HHC – Held that:- The Tribunal was rightly of the view that the sales tax and excise duty shall not form the part of total turnover - following the decision in Commissioner of Income-Tax Versus Lakshmi Machine Works [2007 (4) TMI 202 - SUPREME Court] wherein it has been held that while interpreting the words "total turnover" in the formula in Section 80HHC, one has to give a schematic interpretation and the various amendments made therein show that receipts by way of brokerage, commission, interest, rent, etc. do not form part of business profits, as they have no nexus with the activity of export, and therefore, excise duty and sales tax also cannot form part of the "total turnover" u/s 80HHC(3) – thus, the amounts towards sales tax and the excise duty cannot be included in the total turnover – thus, the Tribunal committed no error in directing the AO to exclude sales tax and excise duty from the total turnover – Decided against revenue.
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