2009 (9) TMI 1018 - AT - Income Tax

Summary

Issues involved:
The judgment involves issues related to the applicability of the second proviso to sub-Section 3 to Section 80HHC of the Income-tax Act, 1961 for the allowance of deduction u/s.80HHC in respect of income from DEPB license, and the exclusion of excise duty and sales tax from the total turnover for computing deduction u/s.80HHC.

Assessee's Appeal (ITA No.131/Ahd/2008):
The only issue in the assessee's appeal is regarding the applicability of the second proviso to sub-Section 3 to Section 80HHC of the Act for the allowance of deduction u/s.80HHC in respect of income from DEPB license. The assessee contended that its export turnover is below Rs. 10,00,00,000, contrary to the CIT(A) and Assessing Officer's findings. The Tribunal directed the Assessing Officer to verify the export turnover, and if it is below Rs. 10,00,00,000, the assessee is entitled to relief as per the amended provision. The issue of the assessee's appeal was allowed for statistical purposes.

Revenue's Appeal (ITA No.507/Ahd/2008):
The first issue in the Revenue's appeal was against the order of CIT(A) directing the Assessing Officer to exclude excise duty and sales tax from the total turnover for computing deduction u/s.80HHC. The Tribunal dismissed this issue in favor of the assessee, citing a decision of the Hon'ble apex court. The next issue in the Revenue's appeal was against the order of CIT(A) directing the Assessing Officer to allow deduction u/s.80HHC on a disclaimer certificate issued by M/s. Clariant (India) Ltd. The Tribunal found that the assessee had correctly claimed deduction based on the disclaimer certificate and confirmed the findings of the CIT(A), dismissing this issue of the Revenue's appeal.

Conclusion:
The Tribunal allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal. The judgment was pronounced in Open Court on 11/09/2009.