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2015 (2) TMI 992 - HC - Income TaxDeduction u/s 80HHC - AO restricted the claim after adjusting the trading loss to its manufacturing profits and adding of 90% export incentives - CIT issued a notice u/s 263 to held that the respondent is not entitled to claim deduction under Section 80HHC - whether Commissioner of Income Tax could not have exercised jurisdiction under Section 263 to revise an order of assessment dated 30 January 2004 when the same has been a subject matter of appeal before the Commissioner of Income Tax (Appeals) - Held that:- When the assessment order was passed, absent the amendment of 2005, it was not open to the Assessing Officer to set off losses against export incentives. In terms of the first proviso, only profits could be increased by export incentives and therefore the order of assessment dated 30 January 2004 was erroneous and prejudicial to the interest by the Revenue and powers under Section 263 of the Act could legitimately be exercised by the CIT. For the purposes of this appeal even if assume (without having examined the same) that the Revenue is correct and set aside the impugned order and restore the matter to Assessing Officer, yet the Assessing Officer will while recomputing the benefit available under Section 80HHC of the Act will have to extend the benefit of the retrospective amendment resulting to the same result as found in the Assessment Order dated 30 January 2004. It is relevant to note that even the Revenue does not dispute the applicability of retrospective amendment. In the above view, we do not deem it necessary to answer the substantial question of law as formulated particularly in view of the retrospective amendment making the challenge academic. - Decided against revenue.
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