2010 (4) TMI 216 - HC - Income Tax

Deduction u/s 80HHC - receipts on account of Foreign Exchange Fluctuation on EEFC Account and interest on EEFC Account – ITAT decided that the receipts on account of Foreign Exchange Fluctuation on EEFC Account and interest on EEFC Account can be treated as part of business income and accordingly included in the profit of business while calculating deduction u/s .80HHC - Held that: - The Tribunal has merely relied upon decisions of its coordinate benches and there is merit in the submission of counsel appearing on behalf of the Revenue that the Tribunal ignored the plain meaning and intendment of the words used by Parliament while legislating upon Section 80HHC. The fluctuation in the present case is not on account of the sale proceeds or for that matter on account of a delayed realization of the sale proceeds. The fluctuation has arisen in the deposits maintained by the assessee in the EEFC Account in convertible foreign exchange after the completion of the export transaction. - The interest which accrued to the assessee on the deposits held in the EEFC Account cannot be treated as business income. – decided in favor of revenue and against the assessee