TMI Blog2014 (10) TMI 974X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 80HH of the Act Thus setting aside the order of the Tribunal, in so far as it relates to items (b) and (c) claimed by the respondent, viz. : "(b) Interest given by the banks in respect of the moneys received by the said banks on behalf of the assessee-company against the pub lic issue of shares ; and (c) Interest earned in respect of the temporary intercorporate deposits kept by the assessee-company with other companies, out of the proceeds of the public issue of shares." - Income Tax Tribunal Appeal No 216 of 2003 - - - Dated:- 15-10-2014 - L. Narasimha Reddy And Challa Kodanda Ram JJ. For the Appellant : S. R. Ashok, Senior Standing Counsel for Income-tax Department For the Respondent : S. Ravi, Senior Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r exemption. 4. Heard Sri S. R. Ashok, learned senior counsel for the Department, and Sri S. Ravi, learned senior counsel for the respondent. 5. Parliament intended to encourage the entrepreneurs to export the products from India. As part of that, it incorporated section 10B of the Act. Sub-section (1) thereof, as it stood before the provision was amended in the year 2001, reads as under : 10B. Special provision in respect of newly established hundred per cent. export-oriented undertakings.-(1) subject to the provisions of this section, any profits and gains derived by an assessee from a hun dred per cent. export-oriented undertaking (hereafter in this section referred to as 'the undertaking') to which this section applie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be an income derived from 100 per cent. export activity. It is no part of the scheme of any export that the agency must mobilise resources by going for public issue much less that such an agency is entitled to appropriate the interest that is derived, on account of its own delay in finalising the issue of shares. The third component stands on a still fragile footing. Before it has allotted shares, the respondent has taken away the money deposited by the intending purchasers of shares and has invested in some companies. The interest that is earned from such deposits was sought to be clubbed with the amount representing profits and gains derived from 100 per cent. export activity. 9. The Commissioner of Income-tax (Appeals) referred to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39;s case (supra), in the light of the judgment of the Supreme Court in Pandian's case (supra). 12. We, therefore, partly allow the appeal, setting aside the order of the Tribunal, in so far as it relates to items (b) and (c) claimed by the respondent, viz. : (b) Interest given by the banks in respect of the moneys received by the said banks on behalf of the assessee-company against the pub lic issue of shares ; and (c) Interest earned in respect of the temporary intercorporate deposits kept by the assessee-company with other companies, out of the proceeds of the public issue of shares. However, we sustain the relief granted in respect of item (a), viz., interest earned in respect of bank deposits kept for opening lett ..... X X X X Extracts X X X X X X X X Extracts X X X X
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