2016 (12) TMI 615 - SC - Income Tax

Prospectivity of Section 80 HHC as amended in 2005 - Held that - As far as issue relating to turnover below 10 crores and above 10 crores is concerned the same has already been answered in the recent order in C.I.T. -5 & ANR. VS. M/S. AVANI EXPORTS & ANR.(2015 (4) TMI 193 - SUPREME COURT ) making it clear that it applied to both categories. Having seen the twin conditions and since 80HHC benefit is not available after 1.4.05 we are satisfied that cases of exporters having a turnover below and those above 10 cr.

Summary

Issues:
1. Interpretation of Section 80 HHC of the Income Tax Act, 1961 as amended in 2005, regarding its prospective operation.
2. Clarification on the applicability of turnover thresholds below and above 10 crores.

Analysis:

Issue 1: Interpretation of Section 80 HHC - Prospective Operation
The Supreme Court, in the judgment, addressed the issue of whether Section 80 HHC of the Income Tax Act, 1961, as amended in 2005, operates prospectively. The Court conclusively stated that the provision is only prospective in its application, settling any ambiguity on this matter.

Issue 2: Turnover Thresholds
Regarding the turnover thresholds, the Court referred to a previous order dated 30.03.2015 in SLP(C) No.9273 of 2013 (C.I.T. -5 & ANR. VS. M/S. AVANI EXPORTS & ANR.) where it was clarified that the provisions applied to both categories, i.e., turnover below 10 crores and above 10 crores. Based on this clarification, the Court disposed of the appeals in question.

In conclusion, the Supreme Court's judgment clarified the prospective nature of Section 80 HHC of the Income Tax Act, 1961, as amended in 2005. Additionally, the Court affirmed the applicability of turnover thresholds to both categories, below and above 10 crores, based on a previous order. The judgment emphasized the settled legal position on these issues and incorporated the relevant order dated 30.03.2015 into the decision.