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TMI Blog2008 (6) TMI 327X X X X Extracts X X X X X X X X Extracts X X X X ..... RAVIRAJA PANDIAN J.— These two appeals relate to the assessment year 2001-02 preferred against the common order dated March 16, 2007, passed by the Income-tax Appellate Tribunal in two appeals in I. T. A. No. 551/Mds/2005 and I. T. A. No. 674/Mds/2005. 2. The material facts culled out from the statement of facts, stated in the memorandum of appeal, are as follows: 3. The assessee is a manufacturer of automobile components like air brakes and non-ferrous castings. The assessee-company filed its return of income for the assessment year 2001-02 declaring total income of Rs. 14,43,44,360. The assessee subsequently filed a revised return declaring the total income in a sum of Rs. 14,20,68,210. The assessee has purchased software to the tune ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax (Appeals) held that the write back provision and the exchange rate provision are directly connected with the business activity and hence 90 per cent. of the same should not be reduced from the profit of the business. 5. Aggrieved by the order of the Commissioner of Income-tax (Appeals), the Revenue as well as the assessee filed separate appeals to the Income-tax Appellate Tribunal. The Tribunal by its common order, which is impugned in these appeals, set aside the orders of the authorities below and directed the Assessing Officer to decide the issue about the claim of the assessee on purchase of software components after obtaining necessary details for verification. In respect of the income earned from various deposits, as sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der section 80 HHC of the Income-tax Act, 1961?" T. C. (A) No. 370 of 2008: "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in holding that, sales tax collections are to be excluded from business profits in the calculation of deduction under section 80HHC of the Income-tax Act, 1961?" 7. It is the submission of the learned counsel for the Revenue that the first question is squarely covered against the Revenue by the decision of this court in the case of CIT v. Southern Roadways Ltd.[ 2007] 288 ITR 15, wherein it was held that the upgradation of computers by changing certain parts thereby enhancing the configuration of the computers for improving their efficiency, but w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the appeal in T. C. (A) No. 370 of 2008, as to whether the Income-tax Appellate Tribunal was right in law in holding that, sales tax collections are to be excluded from business profits in the calculation of deduction under section 80HHC of the Income-tax Act, 1961 is covered by the decision of the Supreme Court in the case of CIT v. Lakshmi Machine Works [2007] 290 JTR 667, wherein it has been held as follows (page 683): "The principal reason for enacting a formula in section 80HHC of the Income-tax Act, 1961, is to disallow a part of the concession there under when the entire deduction claimed cannot be regarded as relating to exports. Therefore, while interpreting the words 'total turnover' in the formula in section 80HHC one has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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