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2015 (4) TMI 1110 - HC - Income TaxRevision u/s 263 - deduction u/s 80 HHC - whether the lease hire charges and refund of duty on export proceeds on other services, received by the assessee was operational income attributable to the business of the Assessee or not ? - Held that:- Commissioner of Income Tax in exercising his powers in revision has sought to revise the same on the ground that the aforesaid income has for the purposes of Section 80 HHC of the Act has to be excluded from business income and considered as income from other sources. This for the purposes of arriving at export profits under Section 80 HHC of the Act. It is not disputed that the respondent - assessee's income from hire / lease from vessels / barges etc. were a part of its business income under the head of profit and gain of business as a part of its composite business. The order in revision of the Commissioner of Income Tax, seeks to reclassify income from profit and gain of business as income from other sources merely on the ground that such income is not connected with export business and does not qualify for export business. This view of the Commissioner of Income Tax is not correct in law and the view taken by the Assessing Officer cannot be said to be erroneous. This is for the reason that undisputedly to take care of such contingencies that the parliament has prescribed a formula in Section 80 HHC (3) of the Act to arrive at the profits derived from the export business. The above formula which enables arriving at the profits attributable to export business after taking into account the profit of the business as a whole subject to clause (baa) of the explanation to Section 80 HCC of the Act. Thus the Assessing Officer's view was not erroneous for the exercise of powers of revision under Section 263 of the Act. In fact, on the contrary, if the Commissioner's reasoning is to be adopted that all income which is not connected with export business even if it is a part of profits and gain of business has to be reclassified as income from other sources, then clause (baa) of the explanation to Section 80 HHC of the Act would be rendered redundant. This is for the reason that then there would be no occasion to reduce the profits and gains of business by 90% of any income which falls therein. It is well settled principle of law that a statute should not be so interpreted that any part of statute is rendered redundant. Besides, in any view of the matter, the view taken by the Assessing Officer on the basis of the law as it then stood is a possible view. Thus, the exercise of jurisdiction under Section 263 of the Act by the Commissioner of Income Tax is not justified. - Decided in favour of assessee
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