TMI Blog2016 (7) TMI 1303X X X X Extracts X X X X X X X X Extracts X X X X ..... 0IA was enacted to have universal application to all deductions under sub-chapter C of Chapter VI - different formulae have been provided for manufacturing exporter and trader and in case of an assessee whose exports comprise of both the sources - at the stage of sub-section (3) of section 80HHC effect of sub-section (9) of section 80IA would apply - clause (baa) to explanation to section 80HHC defines a term 'profits of the business' - While working out the business profits as specified therein, in terms of sub-section (9) of section 80IA the profit or gain which had already been allowed deduction to the extent mentioned therein would have to be ignored. In IPCA Laboratory Ltd. v. Deputy Commissioner of Income-Tax reported in [2004 (3) TMI 9 - SUPREME Court] it has been held that Section 80AB is also in Chapter VI-A - It starts with the words "where any deduction is required to be made or allowed under any Section of this Chapter" - This would include Section 80HHC - Section 80AB further provides that "notwithstanding anything contained in that Section" - Thus Section 80AB has been given an overriding effect over all other Sections in Chapter VIA -Section 80HHC does not provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision in the case of ACIT v. Micro Labs Ltd. reported in [2016] 380 ITR 1 (SC) , therefore, present appeals may be adjourned to some future date. 4. Though the aforesaid position is not in dispute, Mr.K.M.Parikh, learned advocate for the respondent submitted that, for the time being, the issue involved in these appeals is covered by the decision of this Court in the case of Commissioner of Income Tax v. Atul Intermediates , reported in [2015] 373 ITR 638 (Gujarat) , and prayed that these appeals may also be disposed of accordingly. 5. While deciding the matter, in the case of CIT v. Atul Intermediates (supra), this Court observed as under:- 24. We have noticed that Chapter VI of the Act pertains to deductions of certain incomes. Part-A thereof contains provisions of general applicability. Under sub-section (2) of section 80A, it is provided that the aggregate amount of deductions under Chapter VI shall not in any case exceed the gross total income of an assessee. However, the reference in this section is to the gross total income of an assessee, and not the business income. The situation, therefore, would arise as is apparent from the decision of Madhya Pradesh Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that matter under the provisions of sub-chapter C to Chapter VI would amount to giving no effect to the earlier portion of the sub-section, which specifically provides for making a disallowance of deduction claimed by the assessee under various provisions contained in sub-chapter C profit or gain of an undertaking or enterprise which has already been claimed and allowed under section 80IA. In case of Aswini Kumar Khose v. Aravinda Bose reported in AIR 1952 SC 369 the Supreme Court observed that it is not a sound principle of construction to brush aside words in a statute as being inapposite surplusage, if they can have appropriate application. In case of Rao Shiv Bahadur Singh v. State of Uttar Pradesh reported in AIR 1953 SC 369 the Court observed that it is incumbent on the Court to avoid a construction, if reasonably permissible on the language, which would render a part of statute devoid of any meaning or application. In our understanding, therefore, subsection (9) of section 80IA has two implications. First part would operate as to denying an assessee's claim of deduction under other provisions of sub-chapter C of Chapter VI when a certain profit or gain has alrea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. Thus, if there is any indication of legislative intent to allow the full deduction under section 80HHC of the Act irrespective of the provision contained in subsection (9) of section 80IA, such legislative intent must prevail. On the other hand, if we find that section 80HHC of the Act is not immune to outside influence, full play of the provision of sub-section (9) of section 80IA must be allowed, even if it means restricting the claim of an assessee for deduction under section 80HHC of the Act. In other words, merely because subsection (9) of section 80IA does not contain non-obstante clause would not by itself mean that it can have no effect on the deduction under section 80HHC of the Act. As is well known, the Legislature uses the non-obstante clause typically using expression `notwithstanding anything contained in any other provision, Act or law for the time being in force'. Ordinarily, such expression would be equivalent to saying that inspite of the provision of the Act mentioned in non-obstante clause, the enactment following any such provision have full operation. Thus, often times, non-obstante clause is used to override other statutory provisions specified in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A redundant and meaningless. 28. It is true, as pointed out by the counsel for the assessee that in different provisions the Legislature has used different language for restricting or limiting the claim of deductions. The use of language in statutory provisions in such complex situations must be peculiar to every situation the Legislature may seek to meet with. Merely because in some of the provisions certain disallowances are expressed in different language would not by itself mean that sub-section (9) of section 80IA was aimed to have restricted and limited scope of application. 29. The contention that no such matching provision was made in section 80HHC of the Act would clearly indicate the Legislative intent also, in our opinion, is not a valid argument. Sub-section (9) of section 80IA was enacted to have universal application to all deductions under sub-chapter C of Chapter VI. It was neither possible nor expected of the Legislature to make individual matching provisions in large number of statutory provisions recognizing deductions under various situations. Such provisions are often times made for a limited period, new deductions are introduced from time to time a ..... 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