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TMI Blog2013 (12) TMI 866X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case, the Tribunal was justified in holding that for purposes of computing relief u/s 80 I, relief granted u/s 80 HH cannot be deducted from the gross total income? (2) Whether on facts and in the circumstances of the case, the ld. ITAT was legally justified in directing the A.O to recompute the allowable deduction in view of the decision of the Hon'ble High Court of M.P. in the case of J.P. Tobacco Products (P) Ltd Vs. C.I.T. reported in ITR 140 CTR 329 whereas provisions of sub-section (9) of Section 80 HH provide that where the assessee is entitled for deduction both u/s 80 HH and 80 I/80 J, the effect first is to be given to Section 80 HH of I.T. Act? (3) Whether on the facts and in the circumstances of the case, the Ld. ITAT wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ext ground is in regard to deduction u/s 80-I and 80-HH. The assessee raised the ground that the CIT (A) was wrong in law in building what relief u/s 80-I is to be allowed only with reference to the remaining eligible profit after relief u/s 80-HH has already been allowed. In this regard, both the parties are agreed that the issue is now squarely covered by decision of the Hon'ble High Court of Madhya Pradesh in the case of J.P. Tobacco Products P Ltd Vs. C.I.T (1997) 140 CTR 329. In that case, it was held that the provision of law is clear that in so far as benefit of section 80 I is concerned, it has to be granted on the gross total income and not on the income reduced by the amount allowed u/s 80 HH. It was, therefore, held that for purp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be claimed both under sections 80-HH and 80-I on the gross total income. Against this judgment a special leave petition was filed in this court which was dismissed on the ground of delay on July 21, 2000 (see [2000] 245 ITR (St.) 71). The decision in J.P. Tobacco Products P. Ltd [1998] 229 ITR 123 (MP) was followed by the same High Court in the case of CIT v. Alpine Solvex P. Ltd in I.T.A. No. 92 of 1999 decided on May 2, 2000. Special leave petition against this decision was dismissed by this court on January 12, 2001 (see [2001] 247 ITR (St.) 36). This view has been followed repeatedly by different High Courts in a number of cases against which no special leave petitions were filed meaning thereby that the Department has accepted th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Apollo Tyres (Supra) held as follows:- "In Apollo Tyres (supra), this Court examined the object of introducing section 115J in the 1961 Act. The Court relied on the budget speech of the then Hon'ble Finance Minister of India made in the Parliament while introducing the said section. The relevant portion of the speech is reproduced as under: "It is only fair and proper that the prosperous should pay at least some tax. The phenomenon of so-called zero-tax highly profitable companies deserves attention. In 1983, a new Section 80-VVA was inserted in the Act so that all profitable companies pay some tax. This does not seem to have helped and is being withdrawn. I now propose to introduce a provision whereby every company will have to pay a min ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of the Companies Act which obligates the company to maintain its account in a manner provided by the Companies Act and the same to be scrutinized and certified by statutory auditors and will have to be approved by the company in its general meeting and thereafter to be filed before the Registrar of Companies who has a statutory obligation also to examine and satisfy that the accounts of the company are maintained in accordance with the requirements of the Companies Act. In spite of all these procedures contemplated under the provisions of the Companies Act, the Court observed that it is difficult to accept the argument of the Revenue that it is still open to the Assessing Officer to rescrutinize this account and satisfy himself that thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and III of Schedule VI to the Companies Act, 1956. In the case of Apollo Tyres Ltd. [2002] 255 JTR 273, the apex court held that while computing the income under Section 115J of the Income-tax Act, the Assessing Officer has only power to examine whether the books of account were certified by the authorities under the Companies Act as having been properly maintained in accordance with the Companies Act. It is further held that the Assessing Officer thereafter has limited powers of making increases and reductions as provided for in the Explanation to the said section. The apex court further held that the Assessing Officer does not have the jurisdiction to go beyond the net profits shown in the profit and loss account, except to the extent pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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