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Issues involved: Allowability of claim of deduction in respect of DEPB income, Condonation of delay in filing the appeal.
Condonation of delay: The appeal was delayed by 1598 days due to rejection of claim by AO based on retrospective amendment to section 80HHC. Assessee filed condonation application citing advice against filing appeal until clarification from Hon'ble Supreme Court. Assessee argued lack of due diligence was not deliberate. Tribunal, after considering the facts, condoned the delay in the interest of justice. Merits of the case - Deduction u/s 80HHC: Assessee claimed deduction u/s 80HHC for DEPB income of Rs. 3,81,34,020. AO rejected the claim citing Finance Act 2005 amendment. In appeal, CIT(A) upheld AO's decision. Assessee contended that Hon'ble Supreme Court's judgment in Topman Exports Ltd case supported the claim for DEPB income deduction. Tribunal noted conflicting decisions by Tribunal and High Court but followed Supreme Court's decision, directing AO to recompute deduction u/s 80HHC in line with Topman Exports Ltd judgment. Conclusion: Tribunal allowed the appeal for statistical purposes, setting aside CIT(A)'s order and directing AO to recompute deduction u/s 80HHC for DEPB income based on Hon'ble Supreme Court's decision in Topman Exports Ltd case. Judges: HON'BLE PRESIDENT SHRI H.L. KARWA AND SHRI RAJENDRA SINGH ACCOUNTANT MEMBER
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