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2016 (8) TMI 96 - GUJARAT HIGH COURT

2016 (8) TMI 96 - GUJARAT HIGH COURT - TMI - Computation of deduction under Section 80HHC - whether export incentive will become part of the income from business - Held that:- The issue raised is covered by the Department’s Circular No.564 dated 05.07.1990 wherein, it has been provided in Clause (5) under the head of “Clarifications regarding calculation of deductions” that cash compensatory support (CCS), duty drawback (DDK) and profit on sale of import entitlement licences (I/L) shall be taxab .....

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ncome-tax, [2009 (8) TMI 63 - SUPREME COURT ] wherein, it has been held that duty drawback receipts / Duty Entitlement Pass Book benefits are on account of statutory provisions in Customs Act / Schemes framed by the Government and therefore, profits so derived do not form part of net profits of eligible industrial undertaking for purposes of Sections 80IB, 80I and 80IA. Learned counsel Mr. Dave could not point out any distinguishing feature, which may warrant a different view. - Exclusion of .....

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sales tax are indirect taxes. They are recovered by the assessee on behalf of the Government and therefore, if they are made relatable to exports, the formula under Section 80HHC would become unworkable. Learned Standing Counsel Mrs. Bhatt could not point out any distinguishing feature, which may warrant a different view. - Decided in favour of the assessee and against the Revenue. - Deduction under Section 80HHC - income from the sale of scrap - Held that:- As settled by the judgment of Ap .....

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, which was not capable of being used, was sold as scrap because it could not be recycled in the same form of sheets of stainless steel, as the assessee was not having a rerolling plant. On these facts, the Apex Court held that proceeds generated from sale of scrap could not be included in “total turnover” for the purpose of computation for deduction u/s.80HHC. - Decided in favour of the assessee and against the Revenue. - Deduction under Section 80HHC - net interest received from customer - .....

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of an assessee will have to be first computed under the head “Profits and Gains of Business or Profession” in accordance with provisions of Sections 28 to 44D. In the computation of such profits of business, all receipts of income, which are chargeable as profits and gains of business under section 28, will have to be included. Similarly, in computation of such profits of business, different expenses which are allowable under sections 30 to 44D, have to be allowed as expenses. After including s .....

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he issues in view of the Circular No.21/2015 dated 10.12.2015 issued by Central Board of Direct Taxes, New Delhi wherein, it has been decided that no appeals shall be preferred before High Courts in cases where the tax effect does not exceed the monetary limit of ₹ 20.00 Lacs. It is also decided that the said Circular shall apply retrospectively in pending appeals as well. Hence, both the issues are answered in favour of the assessee and against the Revenue. - TAX APPEAL NO. 983 of 2009 - .....

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ribunal is right in restoring the issues relating to computation of deduction under Section 80HHC of the Income Tax Act, 1961 with regard to export incentive of ₹ 88,22,127/, holding that the said sum will become part of the income from business? (B) Whether the Income Tax Appellate Tribunal is right in law and on facts in restoring the issue relating to duty free import benefit of ₹ 88,22,127/for the purpose of calculating deduction under Section 80IB of the Income Tax Act, 1961? (C .....

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p and thereafter restoring the issue? (E) Whether the Income Tax Appellate Tribunal is right in law and on facts in holding that only the net interest received from customer is required to be considered while giving effect to explanation (baa) to Section 80HHC of the Income Tax Act, 1961? (F) Whether the Income Tax Appellate Tribunal is right in law and on facts in holding that discount / kasar can be stated to be derived from industrial undertaking and therefore, eligible for deduction under Se .....

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u/s.115JA of ₹ 43,73,631/along with the return of income. The A.O. passed the assessment order u/s.143(3) of the Act on 27.03.2003 and held that regular income was more than the income u/s.115JA of the Act and therefore, the provisions u/s.115JA is not invoked. 3. Against the order of A.O., the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal by order dated 25.08.2003. Being dissatisfied with the order of CIT(A), the Revenue filed appeal before the Tribunal. B .....

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DK) and profit on sale of import entitlement licences (I/L) shall be taxable under the head Profits and gains of business or profession in view of the amendment of Section 28 by The Finance Act, 1990. All the three export incentives shall have to be included in the profits of business for computing the deduction u/s.80HHC. Thus, the Question No.(A) is answered in favour of the assessee and against the Revenue. 6. As regards Question No.(B), learned counsel for the Revenue submitted that the same .....

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any distinguishing feature, which may warrant a different view. In view of the same, the Question No.(B) is answered in favour of the Revenue and against the assessee. 7. The issue raised in the form of Question No. (C) is also settled by the judgment of Apex Court in the case of Commissioner of Income-tax, Coimbatore v. Lakshmi Machine Works, [2007] 160 Taxman 404 (SC) wherein, it has been held that excise duty and sales tax cannot form part of the total turnover under Section 80HHC(3) as they .....

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ered in favour of the assessee and against the Revenue. 8. The issue raised in the form of Question No. (D) is also settled by the judgment of Apex Court in the case of Commissioner of Income-taxVII, New Delhi v. Punjab Stainless Steel Industries, [2014] 46 taxmann.com 68 (SC). In that case, the issue was whether turnover would mean only the amount of sale proceeds received in respect of goods in which an assessee is dealing in for computing deduction u/s.80HHC of the Act. The assessee therein w .....

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n view of the above, the Question No.(D) is answered in favour of the assessee and against the Revenue. 9. The issue raised in the form of Question No. (E) is also settled by the judgment of Apex Court in the case of ACG Associated Capsules (P) Ltd. v. Commissioner of Income-tax, Central-IV, Mumbai, [2012] 18 taxmann.com 137 (SC) wherein, it has been held that Explanation (baa) to section 80HHC states that profits of the business means the profits of the business as computed under the head Profi .....

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