TMI Blog2006 (4) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... uty amounting to Rs. 1,63,38,856 is includible in the profits computed for the purpose of deduction under sections 80HH and 80-I of the Income-tax Act, 1961?" The assessee-company is engaged in the business of manufacture of steel pipes and steel tubes and cold rolled formed sections. It filed return of the income for the assessment year 1995-96 on November 30, 1995, showing income of Rs. 9,24,490. After examining the books of account and other relevant documents, the Assessing Officer completed the assessment under section 143(3) on March 27, 1998, on the total income of Rs. 85,23,550. After passing the order, the Assessing Officer noted that there was a mistake apparent on record and initiated rectification proceedings under section 154 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent earned by the assessee on which claim for deduction under the provisions of section 80-HH was being made. It was observed by the apex court that since it relates to the profits derived from the industrial undertaking, such a claim was not admissible. Learned counsel for the assessee, per contra, has referred to the statement to point out that the controversy before the apex court was quite different and has no bearing over the issue raised in the present case and the Tribunal has, therefore, rightly distinguished the said case. Before adverting to the contention of the learned counsel for the parties, it would be advantageous to first refer to the provision contained in subsection (1) of section 80HH of the Income-tax Act which reads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking and it has, therefore, inflated the profits and gains component of the very industrial undertaking. From the facts placed on record before us, we are not able to say that any refund has been diverted for the purpose other than the business of the industrial undertaking and, therefore, we have no hesitation in holding that the amount refunded had the result of inflating the profits and gains of the industrial undertaking, the respondent assessee. Learned senior counsel for the Department has also referred to CIT v. Sundaram Clayton Ltd. [2006] 281 ITR 425 (Mad) holding that the sales tax, excise duty on sales of raw materials, charges of miscellaneous income and commission do not form part of the turnover for the purpose of calculati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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