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2023 (4) TMI 420 - SC - Income TaxDeduction u/s 80-IB - receipts under the Duty Drawback Scheme (Duty Drawback) and on transfer of Duty Entitlement Pass Book Scheme (DEPB) - business of manufacturing and exporting wooden handicraft items - income taxable u/s 28(iiic) and 28(iiib) of the Act, 1961 - HELD THAT:- Section 80-IB provides for deductions in respect of profits and gains from certain industrial undertakings. Therefore, as such for claiming deductions under Section 80-IB, it must be on the “profits and gains derived from industrial undertakings” mentioned in Section 80-IB. An identical question came to be considered by this Court and, more particularly, with respect to the profit from DEPB and Duty Drawback Schemes, in the case of Liberty India [2009 (8) TMI 63 - SUPREME COURT]. Following the law laid down by this Court in the case of Sterling Foods, Mangalore [1999 (4) TMI 1 - SUPREME COURT] and Liberty India [2009 (8) TMI 63 - SUPREME COURT]. as such, no error has been committed by the High Court in holding that on the profit from DEPB and Duty Drawback claims, the assessee shall not be entitled to the deductions under Section 80-IB as such income cannot be said to be an income “derived from” industrial undertaking and even otherwise as per Section 28(iiid) and (iiie), such an income is chargeable to tax. In view of the above and for the reasons stated above, the High Court has rightly held that the respondent – assessee is not entitled to the deductions under Section 80-IB on the amount of DEPB as well as Duty Drawback Schemes. We hold that on the profit earned from DEPB / Duty Drawback Schemes, the assessee is not entitled to deduction under Section 80-IB of the Act, 1961. Any contrary decision of any High Court is held to be not good law. Decided in favor of the Revenue.
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