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Commissioner Of Income Tax Versus Commer. And Associates P. Ltd.

2015 (4) TMI 510 - DELHI HIGH COURT

Provisions of Section 80-HHC of the Income Tax Act, 1961 - Deduction for commission received from Indian parties on transfer of export orders - Held that:- At the outset this Court notices that the impugned order has relied upon a special bench decision of the ITAT - International Research Park Laboratories Ltd. [1994 (7) TMI 304 - ITAT DELHI].The view expressed in that order of the Tribunal by the special bench was that the income derived by the assessee towards commission/brokerage for procuri .....

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nil Chanana [2012 (9) TMI 17 - DELHI HIGH COURT].For the above mentioned reasons the appeal is answered against the revenue and in favour of the assessee. -Decided against the revenue. - ITA 69/2001 - Dated:- 7-4-2015 - S. Ravindra Bhat And R.K.Gauba JJ For the Appellant : Mr. Rohit Madan, Mr. Ruchir Bhatia and Mr. Akash Vajpai, Advs. For the Respondent : None MR. Justice S. Ravindra Bhat (OPEN COURT) 1. The following question of law arises : Whether the ITAT has rightly interpreted the provisio .....

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the special bench was that the income derived by the assessee towards commission/brokerage for procuring export orders for others is eligible for benefit under Section 80HHC(3) of the Income Tax Act. The said view has been in effect approved by the judgment of the Supreme Court in P.R. Prabhakar V. CIT (2006) 284 ITR 548 SC. Facts before the Supreme Court in P. R. Prabhakar are extracted below : 3. By reason of the impugned judgment, the High Court opined that income derived by the appellant to .....

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e, would have retrospective effect. On the said findings, answers to both the questions were rendered in the negative and in favour of the Revenue. 3. The Supreme Court took note of the plain meaning of the expression business of export and held that it includes trading of goods . The Court also relied on the circular of Central Board of Direct Taxes i.e. No.621 dated 19.12.1991, as well as the amendment which was brought into force from 1.4.1992. The Court expressed its conclusions in para 12 a .....

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rk Laboratories Ltd. v. Asst. CIT [1995] 212 ITR (AT) 1, wherein interpreting the Central Board of Direct Taxes circular it was stated (at page 48) : Now, we come to whether the commission received could form part of export profits. Here again, we are unable to see it differently. It is no doubt true that this commission is not turnover but it is a profit relatable to exports. Coming back to section 80HHC(1), if the assessee is an exclusive exporter without having any local sales, then the profi .....

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