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2014 (5) TMI 238 - SC - Income TaxInterpretation of term “Total turnover” – Purpose of enactment of section 80HHC of the Act – Scrap sale - Whether the sale proceeds from the scrap should have been included in the ‘total turnover’ as the assessee was also selling scrap and that was also part of the sale proceeds – Held that:- The term ‘turnover’ would show the sale effected by a business unit - It may happen that in the course of the business, in addition to the normal sales, the business unit may also sell some other things - the word “turnover” would mean only the amount of sale proceeds received in respect of the goods in which an assessee is dealing in - the sale proceeds of the scrap cannot be included in the term ‘turnover’ for the reason that the assessee’s-unit is engaged primarily in the manufacturing and selling of steel utensils and not scrap of steel - the proceeds of scrap would not be included in ‘sales’ in the Profit and Loss Account of the assessee. The intention behind enactment of Section 80HHC of the Act was to encourage export so as to earn more foreign exchange - If the purpose is to bring more foreign exchange and to encourage export, the legislature would surely like to give more benefit to persons who are making an effort to help our nation in the process of bringing more foreign exchange - once the Government decides to give some benefit to someone who is helping the nation in bringing foreign exchange, the Revenue should also make all possible efforts to encourage such traders or manufacturers by giving such business units more benefits as contemplated under the provisions of law – HC was correct coming to the conclusion that the proceeds generated from the sale of scrap would not be included in the ‘total turnover’ – Decided against Revenue.
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