TMI Blog2002 (10) TMI 790X X X X Extracts X X X X X X X X Extracts X X X X ..... hree applications seeks direction to the Tribunal to make a reference on the following question : Whether, on the facts and in the circumstances of the case, the Tribunal was justified in : (a)holding that sales tax, octroi and excise duty on local sales should not form part of total turnover for the purpose of deduction under section 80HHC, ignoring the principle laid down by the Supreme Court in the cases of Chowringhee Sales Bureau (P.) Ltd. v. CIT [1973] 87 ITR 542 and Sinclair Murray Co. (P.) Ltd. v. CIT [1974] 97 ITR 615. (b)directing to allow depreciation on the assets of the company, though lying at the guest house including the guest house building, furniture, etc., ignoring the fact that the case clearly falls under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t include the octroi, sales tax and excise duty on sale, since the expression export turnover did not include these ingredients. The Tribunal further held that it is only the actual sale price, which is relevant and, therefore, anything charged by way of statutory levies such as excise duty and sales tax in addition to the sale price, is to be excluded. Accordingly, the Tribunal accepted the claim of the assessee that sales tax, excise duty and octroi on local sales should not form part of total turnover for the purpose of computation of deduction under section 80HHC. 3. It is contended by Mr. Sundeep Bhandawat, learned counsel appearing for the revenue, that a reading of section 80HHC shows that the intention of the Legislature was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayment of the sales tax was that of the assessee. The assessee-company did not deposit the amount realised by it and the sales tax with the exchequer because it took the position that statutory provision creating a liability upon it was not valid. As the amount of sales tax was received by the assessee in its character as auctioneer, the amount was held to form part of its trading or business of the assessee. Thus, this case has no application to the facts of the instant case. 5. Section 80HHC(1) of the Act inter alia provides that where an assessee is engaged in the business of export of any goods, there shall be allowed in computing the total income of the assessee a deduction of the profits derived by the assessee from the export of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Further the meaning of export turnover in clause (b) of the Explanation to section 80HHC, therefore clearly shows that export turnover did not include excise duty and sales tax. (p. 773) After analyzing the provisions, the Court held that the use of the words profits derived from the exports leads to the inference that the weightage is to be given to such profits. The Court further held that the turnover should be restricted to such receipts, which have an element of profit in it. The Court held, thus : Anything charged by the assessee by way of excise duty and sales tax cannot be taken into account as they do not have any element of profit. Even according to the accounting principles, such levies do not form part of the profit an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... guest house at the site of the mines at Sirohi Road but maintaining a structure to provide certain common facilities to the staff and workers, who had to be provided a shelter at the mines for the purpose of taking meals and recreation facilities during the working of the mines and also for providing safety zone while the blasting in the mines is in operation. The learned Tribunal on appreciation of facts, has arrived at the conclusion that the expenditure was not on the guest house. Thus, the expenditure of ₹ 16,478 has been rightly disallowed (sic-allowed) under section 37(4). The finding of fact does not give rise to any referable question of law. 9. No referable question of law arises from the order of the Tribunal. The Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X
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