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2016 (6) TMI 743 - HC - Income TaxComputing deduction u/s 80IA - inclusion of income from lab sample test - Held that:- The appellant company has apparently disclosed the Lab Sample Test income only I unit-I whereas the deduction u/s.80IA has been allowed on Unit-II and Unit-III. While computing the business profit in these units, the A.O. has adopted the net profit as per the P&L account of that unit and has reduced 'other income' being Lab Sample Test therefrom. As find that the said income has not been included in the first place in the Net Profit as per the P&L Account and therefore, the A.O. was not justified in reducing the same while computing the deduction u/s. 80IA. - Decided in favour of assessee Deduction u/s 80HHC - exclusion of sales tax and excise duty from the total turnover - Held that:- Excise duty and sales tax also cannot form part of the "total turnover" under Section 80HHC(3), otherwise the formula becomes unworkable. In our view, sales tax and excise duty also do not have any element of "turnover" which is the position even in the case of rent, commission, interest etc. It is important to bear in mind that excise duty and sales tax are indirect taxes. They are recovered by the assessee on behalf of the Government. Therefore, if they are made relatable to exports, the formula under Section 80HHC would become unworkable. The view which we have taken is in the light of amendments made to Section 80HHC from time to time. See Commissioner of Income Tax Versus Pogagen Amp Nagarsheth Powertronics Ltd. [2014 (3) TMI 934 - GUJARAT HIGH COURT ] - Decided in favour of assessee
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