9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (4) TMI 862 - HC - Income TaxReopening of assessment u/s 147 - computation of deduction u/s 80IA - 30% of total income or 30 % of profit of eligible business - HELD THAT - The idea and understanding of the Revenue, with regard to the scope of Section 80AB, to enable them to reckon the figure of 30%, confining it to the lower extent of total income from all sources, instead of reckoning it as 30% of the business profit from the eligible business, is thoroughly wrong and misconceived. The stand of the Assessee is supported by ruling of the Division Bench of this court in COMMISSIONER OF INCOME TAX VERSUS JOSE THOMAS. 2001 (11) TMI 73 - KERALA HIGH COURT Since there is no ambiguity in the provisions of Section 80IA, the statute has to be read and understood as it is and cannot be sought to be reI. written or supplemented in any manner. This is more so when Section 80AB stipulating the manner of computation under the Income Tax Act in respect of the deductions to be made under the Income Tax Act, does not come to the rescue of Revenue. This alone has been projected and highlighted by the Tribunal in the order under challenge. As it stand so, there is no substantial question of law to call for interference to decide the issue in favour of the Revenue. - Decided against revenue
Issues:
1. Interpretation of Section 80IA and Section 80AB of the Income Tax Act. 2. Calculation of deduction under Section 80IA for an Assessee engaged in the business of manufacture and sale of automobile tyres and tubes. 3. Applicability of statutory provisions in determining the quantum of deduction under Section 80IA. Issue 1: Interpretation of Section 80IA and Section 80AB of the Income Tax Act The judgment concerns the interpretation of Section 80IA and Section 80AB of the Income Tax Act in the context of allowing deductions for an Assessee involved in the business of manufacturing and selling automobile tyres and tubes. The dispute revolves around whether the deduction under Section 80IA should be calculated based on the total income of the Assessee from all sources or solely on the profit derived from the eligible business. The Tribunal analyzed the statutory provisions and emphasized that Section 80IA clearly states the eligibility of the Assessee to claim a percentage of the profit from the eligible business without reference to the total income from all sources. Similarly, Section 80AB outlines the computation method for deductions under Chapter VIA, indicating that the deduction should be calculated based on the provisions of the Income Tax Act before any deductions are made under Chapter VIA. Issue 2: Calculation of deduction under Section 80IA for the Assessee The key contention in the judgment pertains to the calculation of the deduction under Section 80IA for the Assessee. The Assessing Officer initially restricted the deduction to a lower amount, but the appellate authority directed the deduction to be allowed on a higher figure, which was upheld by the Tribunal. The Tribunal clarified that the Assessee is entitled to claim 30% of the profit derived from the eligible business under Section 80IA, without considering the total income from all sources. The Tribunal's decision was based on a thorough examination of the facts and relevant legal provisions, concluding that the challenge raised against the calculation did not involve any substantial question of law under Section 260A of the Income Tax Act. Issue 3: Applicability of statutory provisions in determining deduction under Section 80IA The judgment delves into the applicability of statutory provisions in determining the quantum of deduction under Section 80IA for the Assessee. The Revenue argued that the deduction should be calculated based on the total income declared from all sources, as per Section 80AB. However, the Tribunal rejected this argument, highlighting that Section 80IA clearly outlines the eligibility of the Assessee to claim a percentage of the profit from the eligible business without any reference to the total income. The Tribunal emphasized that the provisions of Section 80IA must be understood as they are, without seeking to reinterpret or supplement them. Additionally, the Tribunal noted that the ruling in a previous case regarding deduction under Section 80HHC supported the Assessee's position. Ultimately, the Tribunal dismissed the appeal, concluding that there was no substantial question of law warranting interference in favor of the Revenue. This detailed analysis of the judgment provides a comprehensive overview of the issues involved, the interpretation of relevant statutory provisions, and the Tribunal's reasoning in determining the deduction under Section 80IA for the Assessee engaged in the business of manufacturing and selling automobile tyres and tubes.
|
