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Associated Dyestuff Pvt. Ltd., Ahmedabad Versus The ACIT Circle-1 Ahmedabad

2015 (7) TMI 724 - ITAT AHMEDABAD

Eligibility for deduction under s.80HHC - CIT(A) confirming the order of the AO holding that the deduction under s.80HHC was to be computed at NIL - Held that:- In view of the judgement of Avani Exports [2015 (4) TMI 193 - SUPREME COURT ] has categorically ruled that having seen the twin conditions and since 80HHC benefit is not available after 1.4.05, the cases of exporters having a turnover below and those above 10 crores should be treated similarly, we are of the considered view that the ld.C .....

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ppeals)-6, Ahmedabad ( CIT(A) in short) dated 17/08/2011 pertaining to Assessment Year (AY) 2003-04. The Assessee has raised the following grounds of appeal:- 1. Ld.CIT(A) erred in law and in facts in confirming the erroneous order of the ld.AO holding that the deduction under s.80HHC was to be computed at NIL and not granting deduction of ₹ 38,08,898/- under s.80HHC as computed by the appellant. 2. The ld. CIT(A) erred both in law and on facts in holding that the appellant did not satisfy .....

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n not appreciating that the appellant satisfied all the conditions of amended provisions of s. 80HHC and was eligible for deduction computed at ₹ 38,08,898/-. It be so held now. 4. Without prejudice to the above, the ld.CIT(A) erred in confirming the order of the ld.AO which was against the specific direction of the Hon ble Income tax Appellate Tribunal which remanded the matter with a direction to allow the claim as per Para 9 of its order. Not following the specific direction of the Trib .....

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re unjustified. The appellant craves leave to add, amend, alter, edit, delete, modify or change all or any of the grounds of appeal at the time of or before the hearing of the appeal. 2. Briefly stated facts are that this is second round of litigation. In the earlier round, the Tribunal (ITAT C Bench Ahmedabad) vide its order dated 30/10/2009 was pleased to direct the AO to compute deduction u/s.80HHC of the Income Tax Act, 1961 (hereinafter referred to as the Act ) in accordance with the decisi .....

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) 328 ITR 451(Bombay High Court), dismissed the appeal of the assessee. Now, the assessee is further in appeal before us. 3. Ground Nos.1 to 5 are inter-connected and, therefore, the same are being decided together. The ld.counsel for the assessee reiterated the submissions as were made before the ld.CIT(A) and submitted that the AO grossly erred in disallowing the claim of deduction u/s.80HHC(3) of the Act amounting to ₹ 38,08,898/-. The ld.counsel for the assessee further submitted that .....

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he Hon ble Jurisdictional High Court in the case of Avani Exports vs. CIT reported at 348 ITR 391(Guj.) has quashed the amendment to the extent that the operation of the impugned provision should be given effect from the date of amendment and not in respect of earlier assessment years of the assessee whose export turnover is above ₹ 10 crores. She submitted that this judgment of the Hon ble High Court of Gujarat has been further affirmed by the Hon ble Supreme Court in the case of CIT vs. .....

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decision of the Special Bench of the Mumbai Tribunal rendered in the case of Topman Exports vs. ITO(supra). 4. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below. We find that the Tribunal (ITAT C Bench Ahmedabad) in ITA No.776/Ahd/2007 for Y 2003-04 (assessee s own case) vide its order dated 30/10/2009 was pleased to restore the issue in respect of deduction u/s.80HHC of the Act, by observing as under:- 9. Respectfu .....

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ct, 1961 and, therefore, 90% thereof would be added to the export profits as per first proviso to section 80HHC(3) of the I.T.Act.1961. 10. In order to compute deduction u/s.80HHC of the I.T.Act, 1961 in accordance with the decision of the Special Bench in the case of M/s.Topman Exports (supra), we restore the matter to the file of Assessing Officer. 4.1. There is no dispute with regard to the fact that the decision of the Special Bench rendered in the case of Topman Exports vs. ITO(supra) has b .....

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cause whatever amount is reduced from the profit of the business as per Explanation (baa), the same will be increased by the identical amount as per various provisos of Section 80HHC(3) of the Act. In other words, the overall computation of claim of deduction u/s.80HHC will not materially be different under both the judgments. Thus, the amount of deduction of ₹ 38,08,898/- u/s.80HHC as shown will remain unchanged. The AO did not accept the contention on the basis that the export turnover o .....

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