1992 (8) TMI 33 - HC - Income Tax

Summary

Issues involved:
1. Claim of deduction u/s 80HHC for assessment year 1989-90.
2. Recalculation of deduction u/s 80HHC for assessment year 1990-91.

Claim of deduction u/s 80HHC for assessment year 1989-90:
The first petitioner, engaged in export business and dealing in silver, claimed deduction u/s 80HHC for the assessment year 1989-90. The deduction was calculated as per section 80HHC(3)(b) which determines profits derived from export. The first respondent deducted profits from silver business and interest income from advances made by the petitioners. An appeal against this assessment is pending before the Tribunal. An interim order stayed the demand until appeal disposal, with the petitioners paying a partial amount. The court found the respondent's calculations surprising and stayed the demand until appeal resolution.

Recalculation of deduction u/s 80HHC for assessment year 1990-91:
The petitioners claimed deduction u/s 80HHC for the assessment year 1990-91, resulting in a certain income return. However, the respondents recalculated the deduction, adjusting the total income and claiming tax accordingly. This recalculation was challenged based on a previous judgment, stating such adjustments are impermissible under section 143(1)(a). The court set aside the intimation and directed the respondents to issue a fresh intimation in compliance with the law and the mentioned judgment. Any refund due from the fresh intimation was to be adjusted against the demand for the assessment year 1989-90, subject to the final appeal decision for that year.

Conclusion:
The court made the rule absolute, setting aside the recalculation and directing a fresh intimation. No costs were awarded in this judgment.