9911796707
|
Home
Issues Involved:
1. Entitlement to claim deduction from tax for de-oiled cakes exported or sold to exporters under the Finance Act, 1966, for the assessment year 1966-67. 2. Entitlement to claim deduction from income-tax for de-oiled cakes exported or sold to exporters under the Finance Act, 1967, for the assessment year 1967-68. Issue-wise Detailed Analysis: 1. Entitlement to Claim Deduction from Tax for De-oiled Cakes Exported or Sold to Exporters under the Finance Act, 1966, for the Assessment Year 1966-67: The assessee, a registered partnership firm, claimed deductions under section 2(5)(a)(ii) and (iii) of the Finance Act, 1966, for de-oiled cakes exported or sold to exporters. The Income Tax Officer (ITO) rejected the claim, citing that industries engaged in the manufacture or production of vegetable oils and vanaspathi were not entitled to exemption under section 2(5)(c) of the Finance Act, 1966. The Appellate Assistant Commissioner (AAC) accepted the assessee's claim, but the Appellate Tribunal upheld the AAC's decision, prompting the revenue to refer the matter to the High Court. The court analyzed section 2(5)(a)(ii) and (iii) and section 2(5)(c) of the Finance Act, 1966, which provide exemptions for industries specified in the First Schedule to the Industries (Development and Regulation) Act, 1951. However, clause (c) excludes certain industries, including vegetable oils and vanaspathi, from these exemptions. The court concluded that the legislative intent was to exclude the entire industry of vegetable oil and vanaspathi from the exemption, emphasizing that the specified industries' exemption was withdrawn by clause (c). 2. Entitlement to Claim Deduction from Income-tax for De-oiled Cakes Exported or Sold to Exporters under the Finance Act, 1967, for the Assessment Year 1967-68: The assessee similarly claimed deductions under section 2(4)(a)(ii) and (iii) of the Finance (No. 2) Act, 1967, for de-oiled cakes exported or sold to exporters. The ITO rejected this claim for identical reasons as the previous year. The AAC accepted the claim, and the Appellate Tribunal upheld the AAC's decision, leading the revenue to refer the matter to the High Court. The court reiterated its analysis of the relevant sections of the Finance Act, 1967, which are in pari materia with the Finance Act, 1966. The court held that the exclusion of the vegetable oil and vanaspathi industry from the exemption under clause (c) applied equally to the Finance Act, 1967. Therefore, the assessee's claim for exemption was not valid under the Finance Act, 1967, either. Conclusion: The High Court concluded that the assessee was not entitled to claim deductions for de-oiled cakes exported or sold to exporters under the Finance Act, 1966, and the Finance Act, 1967. The court answered both questions in the negative, against the assessee and in favor of the revenue. The court also granted a certificate for appeal to the Supreme Court, recognizing the substantial question of law and its general public importance affecting a large number of exporters.
|
