2009 (2) TMI 48 - HC - Income Tax

Deduction u/s. 80 HHC - Tribunal found that no material was placed before it to suggest that there is an error in the order of CIT(A). It has also been found by the Tribunal that the contention made before the Tribunal was not part of the ground of appeal raised before the Tribunal. It is also found that no additional ground has been raised in this appeal. The same ground was also not raised before the CIT(A) Writ petition by revenue rejected

Summary

Issues:
- Formulation of substantial question of law for deciding the appeal
- Exclusion of certain income from total turnover for computing deduction u/s. 80 HHC
- Tribunal's findings on the error in CIT(A)'s order and the ground of appeal raised before the Tribunal
- Determination of substantial question of law by the Court

Analysis:

1. Formulation of Substantial Question of Law:
The appellant requested the court to treat the substantial question of law framed in the appeal memo as the one to be considered for deciding the appeal. However, the Tribunal noted that this question was not formulated in the appeal memo or argued before the CIT(A). The Tribunal upheld the CIT(A)'s direction to exclude certain income types from total turnover for deduction u/s. 80 HHC. The Court observed that no substantial question of law was formulated at the initial stage, and since the Tribunal found no error in the CIT(A)'s order and the ground raised before the Tribunal did not include the specific question, the Court dismissed the appeal.

2. Exclusion of Income for Deduction u/s. 80 HHC:
The Tribunal highlighted the CIT(A)'s direction to exclude miscellaneous income, dispatch income, sundry creditors written back, and interest income from total turnover for computing deduction u/s. 80 HHC. While the appellant argued for the exclusion of certain items from the profits of business under explanation (baa) to section 80 HHC, the Tribunal found no infirmity in the CIT(A)'s direction. The Court concurred with the Tribunal's decision, upholding the exclusion of such items from the total turnover but noted that the specific contention was not part of the ground of appeal raised before the Tribunal.

3. Tribunal's Findings and Lack of Additional Grounds:
The Tribunal emphasized that no material was presented to suggest an error in the CIT(A)'s order. It also noted that the contention raised before the Tribunal was not part of the grounds of appeal initially raised. Additionally, no additional grounds were introduced during the appeal process. The Court considered these aspects and concluded that no substantial question of law was raised for determination, leading to the dismissal of the appeal due to the lack of substance.

4. Determination of Substantial Question of Law by the Court:
In the absence of a formulated substantial question of law and considering the lack of error in the lower authorities' orders, the Court found no basis for the appeal. As a result, the Court dismissed the appeal, emphasizing that the grounds raised before the Tribunal and the Court did not align with the specific question the appellant sought to address, leading to the lack of merit in the appeal.

This comprehensive analysis outlines the key issues addressed in the judgment, including the formulation of substantial questions of law, the exclusion of certain income for deduction purposes, the Tribunal's findings, and the Court's determination of the appeal's merit.