TMI Blog2006 (2) TMI 584X X X X Extracts X X X X X X X X Extracts X X X X ..... his common order. 2. First, we take up the assessee s appeal for assessment year 1996-97 being I.T.A. No. 4925/M/1999 because this order of learned CIT(A) was followed in other two years. 3. The first ground of appeal in the original Grounds of Appeal is regarding the claim of the assessee for deduction under section 80HHC, which was rejected by the Assessing Officer and CIT(A). The assessee has raised an additional ground for granting deduction under section 80-O as an alternative claim if the claim of deduction under section 80HHC is not allowed. 4. Briefly stated, the facts are that the assessee-company is engaged in the business of producing TV commercials as per specifications of clients located abroad. The sale considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of Abdulgafar A. Nadiadwala v. Asstt. CIT [2004] 267 ITR 488 (Bom.). It was also submitted that the Judgment of Hon ble Apex Court rendered in the case of Tata Consultancy Services v. State of Andhra Pradesh [2004] 271 ITR 401 also supports the case of the assessee because it was held in this case that even incorporeal or intangible property can be "Goods" when put in media for transfer and marketing. She submitted that this Judgment is in respect of Sales Tax but it is held by Hon ble Apex Court that even incorporeal or intangible property can be "Goods" when put in media for transfer and marketing and hence in the present case also, it cannot be said that the films sent abroad by the assessee are not goods as held by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , it was submitted that the services are rendered in India and hence no deduction is allowable under section 80-O and in support of this contention, reliance was placed on the Judgment of Hon ble Jurisdictional High Court rendered in the case of Searley (India) Ltd. v. Central Board of Direct Taxes [1984] 145 ITR 673 (Bom.). 7. We have considered the rival submissions and perused the materials on record. The ground on which the claim of the assessee for deduction under section 80HHC was rejected by the Assessing Officer is now covered in favour of the assessee by the Judgment of Hon ble Jurisdic-tional High Court rendered in the case of Abdulgafar A. Nadiadwala ( supra ) and hence we have to decide whether the assessee was renderi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the transaction of sale of a readymade Suit, Stitching of a Suit with the cloth supplied by the customer and stitching of suit as per the requirement of the customer regarding fabric, colour size measurement and specifications. Admittedly, first is a clear case of sale of goods and second is clear case of rendering of stitching services and the third situation is akin to the issue before us. In the third situation also, the person procures the cloth although of the type and specification required by the customer and stitches the suit and hence in our considered opinion, he is the owner until the customer finds the suit as per his order and delivery is taken by him. If the suit is not as per the specification of the customer, he is not bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is not a case of rendering services only and once we come to this conclusion, the issue stands covered in favour of the assessee by the Judgment of Hon ble Jurisdictional High Court rendered in the case of Abdulgafar A. Nadiadwala ( supra ) and the assessee is entitled to deduction under section 80HHC. But since the Assessing Officer has not examined the correctness of the claim of the assessee, we feel that the matter should go back to the file of the Assessing Officer for the limited purpose of examining the correctness of the amount of deduction claimed by the assessee under section 80HHC and accordingly we, hold that the assessee is entitled to deduction under section 80HHC for export of Ad Films but for the limited purpose of de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is alternative claim of deduction under section 80-O. This issue regarding deduction under section 80HHC is decided in favour of the assessee as per Para No. 7 above as per which, it is held that the assessee is entitled to deduction, under section 80HHC with regard to export of Ad Films and for limited purpose of computing the amount of deduction, the matter is restored to the file of the Assessing Officer and the additional ground regarding alternative claim for deduction under section 80-O is rejected as that ground does not survive. In these two years also, this issue is decided on the same line and the Assessing Officer is directed to allow deduction under section 80HHC for export of Ad Films after checking the quantum of deduction all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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