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2009 (9) TMI 675 - HC - Income TaxDoctrine of merger - Rectification of assessment order u/s 154 despite the fact that CIT(A) has passed an order - issue of deduction under section 80HHD - Order of CIT(A) - held that:- while on a legal principle, the merger doctrine operates only in respect of the subject-matter of the appeal and not on an aspect which was not made the subject-matter, the legal position has also found statutory expression under section 154 of the Act. A perusal of the original assessment order dated March 31, 1999, and the computation as indicated at the end of the assessment order obviously does not show any application of mind on the part of the assessing authority to the intricacies of working out the benefit available to an assessee doing the hotel business or such other business mentioned in the section, getting foreign exchange receipts as part of its business and for qualifying all that the manner of arriving at the figure. - Therefore, the argument of the question being a debatable point does not even arise - Rectification order passed u/s 154 sustained. Deduction under section 80HHD of the Act – method of computation of deduction – whether deduction under section 80HHD of the Act should be computed based on each approved hotel individually and out of the profit derived from each such hotel - Deduction in respect of earnings in convertible foreign exchange – Held that:- in section 80HHD of the Act the reference is to the business of the assessee which is the business as a whole and as one unit and not by sub- dividing the total income of the business into unit-wise total income and then arriving at the unit-wise overall profit proportionate profit and then adding up the same for arriving at the benefit under section 80HHD of the Act – In favor of Revenue.
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