2024 (2) TMI 342 - HC - Income Tax

Deduction u/s 80HHF - profits and gains from export or transfer of film software, etc. - relevancy of certification from Film Censor Board for allowing relief - HELD THAT - We are of the opinion that the issue of certification from the Censor Board is wholly irrelevant for the purposes of examining the applicability of Section 80HHF of the Act. This is a digitally signed order. As contended by the appellant that on meeting two U.S. nationals, he entered into a transaction, pursuant to which he prepared Discs and was also paid in foreign exchange - As the dispute itself pertains to AY 2000-01 and the assessment of which went through several rounds of litigation. Suffice it to note that the ITAT an order 2011 (8) TMI 1376 - ITAT DELHI had remanded the matter while partially allowing the appeal of the appellant and calling upon AO to consider the issue of deductions claimed under Section 80HHF - Pursuant to that order, a fresh assessment order came to be framed on 21 March 2013 and in which the AO held that the appellant had failed to fulfil the conditions laid down in the provision in question. It was this order which was assailed before the CIT (Appeals) which too came to be dismissed on 30 October 2014. As per Section 80HHF what the provision contemplates is the export of transfer of film software, television software, music software, television news software including telecast rights and other items mentioned therein. We note from the record that the appellant has woefully failed to establish before the authorities below that the Disks which were so exported would fall in the genre of any of the software s mentioned and noticed hereinabove. Appeal dismissed.

Summary

Issues involved:
The appeal against the order of the Income Tax Appellate Tribunal for Assessment Year 2000-01 questioning the necessity of a certificate from the Film Censor Board for availing relief under Section 80HHF of the Income Tax Act, 1961.

Certification Requirement under Section 80HHF:
The High Court held that the certification from the Film Censor Board is irrelevant for determining the applicability of Section 80HHF of the Act, emphasizing that the issue of certification is not a prerequisite for examining the relief under the provision.

Export of Film Software and Conditions under Section 80HHF:
The appellant claimed deductions under Section 80HHF for exporting "Discs" to two U.S. nationals and receiving payment in foreign exchange. However, the court noted that the appellant failed to demonstrate that the exported "Discs" qualified as film software, television software, music software, or other specified items under the provision.

Judicial Review and Previous Litigation:
The matter, related to Assessment Year 2000-01, underwent multiple rounds of litigation. The ITAT remanded the case in 2011, leading to a fresh assessment order in 2013 where the Assessing Officer concluded that the appellant did not meet the conditions outlined in Section 80HHF. Subsequent appeals to the Commissioner of Income Tax (Appeals) were also unsuccessful.

Conclusion:
Based on the provisions of Section 80HHF, the High Court determined that the appellant's exported "Discs" did not align with the software categories specified in the Act. Consequently, the court found no merit in the appellant's challenge, leading to the dismissal of the appeal.