TMI Blog2004 (8) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... e can only be computed by deducting the cost of raw material destroyed in fire from the gross receipt of insurance claims. The raw material had been admittedly purchased during the year under consideration and its cost debited in the purchase account of the year. - Accordingly, the question is answered in the negative, i.e., in favour of the Revenue and against the assessee. However, in view of the observations made above, the Tribunal will compute the profit attributable to the receipt of insurance claim and exclude only such profit out of the total income for working out the u/s 80-I - - - - - Dated:- 26-8-2004 - Judge(s) : N. K. SUD., ADARSH KUMAR GOEL JUDGMENT The judgment of the court was delivered by Adarsh Kumar Goel J.- A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for such raw material could be held to be profit derived from the industrial undertaking. Learned counsel for the Revenue submitted that the expression "derived from an industrial undertaking" used in section 80-I(1) of the Act could not include an amount received on account of insurance claim. Learned counsel for the Revenue relied upon a judgment of the apex court in Pandian Chemicals Ltd. v. CIT [2003] 262 ITR 278; the judgment of the Calcutta High Court in CIT v. Andaman Timber Industries Ltd. [2000] 242 ITR 204, the judgment of the Gauhati High Court in North East Gases (P) Ltd. v. CIT [1996] 220 ITR 372 and the judgment of the apex court in CIT v. Sterling Foods [1999] 237 ITR 579. We have heard learned counsel for the Revenue, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds 'derived from', a direct nexus between the profits and gains and the industrial undertaking. In the instant case, the nexus is not direct but only incidental. The industrial undertaking exports processed sea food. By reason of such export, the export promotion scheme applies. Thereunder, the assessee is entitled to import entitlements, which it can sell. The sale consideration therefrom cannot, in our view, be held to constitute a profit and gain derived from the assessee's industrial undertaking." In North East Gases [1996] 220 ITR 372 (Gauhati), the question was whether income derived from interest could be treated as income derived from an industrial undertaking. It was held that, since the source of income did not emerge from the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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