TMI Blog2001 (12) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... ismiss ground No. (1). 3. Ground No. (2) is against sustaining the disallowance of Rs. 10,05,25,017 on account of interest and commitment charges. The AO has dealt with the issue vide para-9 of his order whereas the learned CIT(A) has discussed the issue vide para-4 of the appellate order. The issue is covered in favour of the assessee by the aforesaid order of the Tribunal in the assessee's own case for asst. yr. 1995-96. Respectfully following the said order of the Tribunal for asst. yr. 1995-96 in assessee's own case and in the context of identical facts, we delete the disallowance and allow ground No. (2). 4. Ground No. (3) is against sustaining the disallowance of Rs. 5,81,02,062 on account of Hermes charges as revenue charges. The AO has dealt with the issue vide para-14 of his order whereas the learned CIT(A) has discussed the issue vide para-7 of the appellant order. The issue is convered in favour of the assessee by the aforesaid order of the Tribunal in the assessee's own case for asst. yr. 1995-96. Respectfully following the earlier order of the Tribunal for asst. yr. 1995-96 in assessee's own case and in the context of identical facts, we delete the disallowance a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 3,17,19,19,748 as under: Total turnover : Rs. Rs. Total sales as per P L a/c 3,98,85,53,652 Less : (i) Excise duty recovered 60,98,51,589 (ii) Inter-unit transfer 19,81,39,064 (iii) Total freight and foreign agents commission 86,43,251 81,65,33,904 3,17,19,19,248 Export Turnover has been aggregated at Rs. 15,66,65,202 8.1. The learned counsel invited our attention to p. 27 of the paper book wherein computation of deduction under s. 80HHC, as made by the AO while giving effect to the impugned order of the CIT(A), dt. 24th Feb., 2000, has been indicated. In this computation the AO has arrived at the deduction under s. 80HHC at Rs. 47,10,806 as under: Working of deduction under s. 80HHC: Rs. Export turnover 15,66,65,202 Total turnover for 80HHC benefit 3,81,97,37,337 % to turnover 4.10146 % Income as per order giving effect to CIT(A)'s order 13,53,22,766 Less : Dividend income 2,03,59,620 11,49,63,146 Less : (1) Interest income Nil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal in the case of Sayaji Iron Works (P) Ltd. (1990) 82 CTR (Trib)(Ahd) 335. The learned counsel strongly contended that where there is a decision, though of non-jurisdictional High Court, directly on the point in issue and there being no contrary decision of any High Court, the same has to be followed by the Tribunal acting anywhere in the country. 8.5. Shri S.S. Panwar, the learned senior Departmental Representative, on the other hand, heavily relied upon the decision of the Hon'ble Supreme Court in the case of McDowell Co. Ltd. vs. CTO (1985) 47 CTR (SC) 126 : (1985) 154 ITR 148 (SC) and argued that the excise duty and sales-tax form part of the sale price received by the assessee and cannot be deducted for the purpose of adopting the figure of total turnover. Shri Panwar argued that the Bombay High Court decision relied upon by the learned counsel has not considered the Supreme Court decision on the issue which laid down law of the land. According to Shri Panwar, the learned senior Departmental Representative, the decision of any High Court which is contrary to the legal position enunciated by the Hon'ble Supreme Court, cannot be accepted as good law. The learned senio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which is the assessment year under appeal. 9.1. The CBDT Circular No. 621, dt. 19th Dec., 1991, explained the underlying rationale behind various amendments made in the provisions of s. 80HHC. Para 32.18 of the circular refers to the definition of export turnover and total turnover and read as under: "32.18 Whereas the definition of the term 'export turnover' excludes freight and insurance attributable to transport, no such exclusion has been specified in respect of the term 'total turnover'. As a result, in CIF transactions, while the export turnover is taken at FOB value, the total turnover includes the sale proceeds of exports at CIF value." From the aforesaid, it is amply clear that the legislature, while specifically excluding freight or insurance attributable to foreign transport of goods as well as export incentives did not consciously exclude excise duty and sales-tax received by the assessee from the customers which are admittedly integral and indivisible part of the sale price of the assessee. 9.2. At this stage, we may refer to the decisions of the apex Court whereby the excise duty and sales-tax have been held as forming part of the trading or business recei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for sale, it is for him to quote a price which includes the tax if he desires to pass it on the buyer. If the buyer agrees to the price, it is not for him to consider how it is made up, or whether the seller has included tax or not.' After referring to these observations S.K. Das, J., speaking for the Constitution Bench of this Court, observed: 'We think that these observations are apposite even in the context of the provisions of the Acts we are considering now, and there is nothing in those provisions which would indicate that when the dealer collects any amount by way of tax, that cannot be part of the sale price. So far as the purchaser is concerned, he pays for the goods what the seller demands viz., price even though it may include tax. That is the whole consideration for the sale and there is no reason why the whole amount paid to the seller by the purchaser should not be treated as the consideration for the sale and included in the turnover.'" In the case of Sinclair Murray Co. (P) Ltd. vs. CIT 1974 CTR (SC) 283 : (1974) 97 ITR 614 (SC) the Supreme Court reiterated its aforesaid view and held that sales-tax collected by the assessee constituted its trading receip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cisions in Chowringhee Sales Bureau (P) Ltd. as well as McDowell Co. Ltd. have been considered by the Bombay Bench of the Tribunal in Sudarshan Chemicals Industries Ltd. and since the Bombay High Court has upheld the view taken by the Tribunal, the Supreme Court decisions have obviously been considered even if not specifically discussed in the judgment by their Lordships. We regret, we are unable to persuade ourselves to accept the contention of the learned counsel for the assessee. 9.6. A careful perusal of the Bombay High Court judgment would indicate that the Supreme Court decisions in Chowringhee Sales Bureau (P) Ltd. and McDowell and Co. Ltd. have not been considered or brought to the attention of the Hon'ble High Court and nor have these decisions been discussed or distinguished by their Lordships. At this stage it would be useful to refer to the observations of the Hon'ble Bombay High Court in the case reported in (1975) Bom 324 (333) (1971)(sic) "it is not open to the High Court to whittle down the import of the Supreme Court decision by drawing fine and subtle distinctions". 9.7. There is a well known principle of construction that where legislature uses in Act a l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed in IT Act should be understood in a sense in which no commercial men would misunderstand. The word "turnover" used in fiscal legislation in countries like England, America as well as India has been held to include the taxes levied also. The reason for such inclusion is stated to be that the dealer who realised the tax does not hand it over forthwith the Government but keeps it with him and turns it over in his business before he parts with it. Thus, the tax becomes, for the time being, an integral part of the circulating capital of the tradesman and his turnover in his hands. Therefore, in calculating the total turnover, taxes like sales-tax and excise duty are treated as part of the turnover because "turnover" means the amount of money which is turned over in the business. 9.10. We may now consider the meaning assigned to the word "turnover" in the Standard English dictionaries. The proposition is well accepted that the judicial decisions expounding the meaning of words in construing the statute in pari materia will have more weight than the meaning furnished by the dictionaries. The dictionaries are not dictators of statutory construction, yet it would be permissible to re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it statutory position as contained in the provisions of s. 80HHC. Now in the instant case, it has to be noted that in the P L a/c which forms the basis for working out the relief under s. 80HHC, the assessee has debited an amount of Rs. 6,141.01 lakhs by way of excise duty. On the credit side of the P L a/c the assessee has included in the sales an amount of Rs. 60,98,51,589 on account of excise duty as part of the sale price. It is quite illogical and irrational for the assessee to contend that even though the excise duty is taken into account in the P L a/c, the sales price received by the assessee would be reduced by a portion of the consideration received from the customers by way of excise duty for arriving at the figure of total turnover. The interpretation being urged by the learned counsel is, in our opinion, clearly contrary to the statutory provisions and principles of commercial accounting as well as the well accepted rules of interpretation of statutes as discussed above. 9.13. Regarding the Bombay High Court decision in Sudarshan Chemicals Industries Ltd. we have already pointed out that the decision does not consider the earlier Supreme Court decisions wherein turn ..... X X X X Extracts X X X X X X X X Extracts X X X X
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