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TMI Blog2014 (7) TMI 520X X X X Extracts X X X X X X X X Extracts X X X X ..... h assistance u/s. 28(iiib) against its export eligible to deduction us. 80HHC and not income from other sources ? 2. Whether on the facts and in the circumstances of the case, the Hon'ble Tribunal was right in holding that for the purpose of working out deduction u/s.80HHC, clause (a) of section 80HHC becomes applicable instead of clause (b) as the asessee was engaged in the business of cutting and polishing of rough diamonds which are imported from abroad and then selling cut and polished diamonds in trading of polished diamonds and the percentage of trading of polished diamonds is more than 50% of the total export sales ? 2. Though served, nobody appears on behalf of the respondent-assessee. We have heard Mr. Sudhir Mehta learned advoca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as heavily relied upon the decision of the tribunal in the case of P. Navinkumar & Co. It is submitted that as such, against the decision of the learned Tribunal in the case of P. Navinkumar & Co. (supra), the revenue carried the matter before this Court by way of ITR No. 26/2000. It is further submitted that with respect to the aforesaid issue in the case of P. Navinkumar & Co. (supra), at the instance of the Revenue, reference was made to this Court by way of ITR No. 26/2000 and considering the Taxation Law (Amendment) Act, 2005, which would be applicable with retrospective effect from April 1, 1992, the Division Bench of this Court, vide its judgment and order dated 10.7.2007has remitted the matter to the learned ITAT for its fresh consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... becomes applicable instead of clause (b) as the assessee was engaged in the business of cutting and polishing of rough diamonds which are imported from abroad and then selling out cut and polished diamonds in trading of polished diamonds and the percentage of trading of polished diamonds is more than 50% of the total export sales, is concerned, as such, the aforesaid issue is now not resintegra in view of the decision of the Hon'ble Supreme Court in the case of Gem Granites v. Commissioner of Income-Tax, reported in (2004) 271 ITR 322 (SC), by which, with respect of Granite, the Hon'ble Supreme Court considered the same as mineral. It is required to be noted that in the said decision, the Hon'ble Supreme Court referred to and considered 198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o allowed to be imported on the basis of import licence issued by the licensing authorities for which the importer has to execute a bond with the Government of India for re-export after cutting and polishing within a prescribed time for a value worked out on a given formula. Detailed procedure in this regard is explained in the Import-Export Policy. 3. In view of the position brought by the above features, the export of cut and polished diamonds and gem stones will not amount to export of 'minerals and ores' and hence will qualify for relief under section 80HHC of the Income-tax Act, 1961." [Source: Circular letter F. No. 187/206/83/IT(AI), dated May 22, 1984] 8. Therefore, in view of the aforesaid 1984 Circular, cut and polished diamond ..... X X X X Extracts X X X X X X X X Extracts X X X X
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