2016 (11) TMI 1185 - HC - Income Tax

Deduction u/S 80HHC on counter sales made to foreign tourists - Held that - Substantial question of law which was framed by this court while admitting the appeal has been decided in Commissioner of Income Tax-I Versus M/s. Gem Plaza 2015 (3) TMI 1027 - RAJASTHAN HIGH COURT wherein held that the counter sale to the foreign tourists against convertible foreign exchange in India, is eligible for deduction under section 80HHC of the Income Tax Act. Review application - no substantial question of law framed by this court pertaining to bogus purchases - Held that - As already observed by us, while admitting the appeal this court considered it appropriate to frame the substantial question of law, referred to above, vide order dt.21.03.2012 and no application was filed by the appellant at the later stage for framing of additional substantial question of law, of which reference has been made by us in the present order. Since the substantial question of law, which has been framed by this court, is no more res integra in the light of the judgment, referred to while disposing of the present appeal, we find no apparent error in the order passed by us dt.07.08.2015 which may call for entertaining the instant review application.

Summary

Issues:
1. Deduction under Section 80HHC for counter sales to foreign tourists
2. Genuine purchases made by the assessee
3. Deletion of addition on account of commission paid for obtaining bogus bills

Analysis:
1. The High Court admitted the appeal and framed a substantial question of law regarding the deduction under Section 80HHC for counter sales to foreign tourists. The question was whether the Tribunal was justified in allowing the deduction when the assessee failed to prove that the goods underwent custom clearance. The court referred to a previous judgment where a similar question was decided, making the issue no longer res integra.

2. The review application was filed by the appellant regarding 'bogus purchases.' The appellant argued that the substantial questions of law framed in the memo of appeal were relevant, specifically questioning the genuineness of purchases made by the assessee and the deletion of addition on account of commission paid for obtaining bogus bills. The appellant sought to raise additional substantial questions of law during the hearing but did not file any application for the same at a later stage.

3. The court noted that since the substantial question of law framed earlier was no longer res integra based on the previous judgment, there was no error in the order passed. The court dismissed the review application, concluding that there was no need to entertain it further. The decision was based on the findings regarding the initial substantial question of law framed during the admission of the appeal.