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TMI Blog2012 (12) TMI 598X X X X Extracts X X X X X X X X Extracts X X X X ..... to AO Adjustment in Profit for claiming deduction u/s 80HHC – Whether insurance claim received by the assessee on stock in trade is liable to be reduced to the extent of 90% received while calculating the eligible profits – Held that:- As the insurance claim received on damage of goods/raw material and has direct nexus with the business income. Therefore, insurance claim received by the assessee on stock in trade is not liable to be reduced to the extent of 90% received while calculating the eligible profits. Issue decides in favour of assessee. Adjustment of VAT refund in computing eligible profit u/s 80HHC – Whether Sales Tax remission/refund has been included as business profits it is eligible for deduction u/s 80 HHC - VAT refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vision and should be construed liberally. 4. The learned Commissioner (Appeals) erred in confirming the action of the Assessing Officer in excluding export turnover and total turnover of 100% Pril EOU from export turnover and total turnover of the company, while computing deduction under section 8OHHC. 5. The learned Commissioner (Appeals) erred in confirming the action of the Assessing Officer in excluding 90% of gross interest of Rs. 1,88,72,260, interest of Rs.10,22,435 received on staff loans and Rs. 67,653 received from customers on delayed payment while computing deduction under section 8OHHC. 6. The learned Commissioner (Appeals) ought to have appreciated that since the interest paid was in excess of interest received no intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal in assessee s own case for assessment year 2000- 01, wherein this issue has been dealt vide para 8 to 11. It has been held by the Tribunal that assessee is entitled to allowability of deduction u/s. 80 HHC qua business and not qua assessee, when assessee having maintained separate books of accounts for different business. 3.1 On the other hand, it was submitted by Ld. D.R that while computing deduction under section 80HHC of the Act and submission of Form 10CCAC no separate unit wise allocation has been shown by the assessee, therefore, the earlier decision of the Tribunal will not be applicable in the facts of the present case. Ld. A.R admitted the position that in Form No.10CCAC no such allegation was made. 3.2 In this view of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee a reasonable opportunity of hearing and in accordance with the aforementioned decision of the Hon ble Bombay High Court and any other decision available on the subject. We direct accordingly. This ground is allowed for statistical purposes. 5. Apropos ground No.5,6 7, it was submission of Ld. A.R that directions may be issued to the AO to recompute the deduction under section 80 HHC by reducing the 90% of the net amount and not gross amount mentioned in the grounds. As per chart the issue raised in the grounds of appeal is as under: Direction to reduce 90% of the net and not gross amount of interest income of (i) Rs.85.74 lacs from bank FD, (ii) Rs. 98.49 lacs from ICD, (iii) Rs.0.67 lacs from customer, (iv) Rs. 188.72 lacs f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eligible profits under section 80 HHC. It is also the case of the assessee that in its own cases also the Tribunal has held that insurance claim received by the assesee being part of business income is not liable to be reduced to the extent of 90% and reference in this regard was made to the following decisions: - The appellant inter- alia, relies on Hon ble Mumbai ITAT decision in its own case for the A.Y 2000-01 A Bench vide order, dated 23-09- 08, Appeal No.3314/3242/M/05(Para 26-28, Pg 12 of ITAT order) - The appellant inter-alia, relies on Hon ble Mumbai ITAT decision in its own case for the A.Y 2001-02 I Bench vide order, dated 15-04- 09, Appeal No.8627/9180/M/04 (Para 27, Pg 11 of ITAT order) - The appellant relies on its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . DCIT , 266 ITR 418 (Bom) d) Amar Raja Batteries Ltd. vs. ACIT 85 TTJ 20 / 91 ITD 280 (Hyd) (Related to 80I) A VAT refund of Rs. 12,07,330/- was received by the assessee vide letter dated 21/12/2006. It was the submission of the assessee that the said incomes are on revenue account and routed through profit and loss account. The expenses on these accounts have earlier inflated the cost of purchases / production cost and, therefore, these receipts are nothing but abatement of purchase / production cost and is thus integral part of the manufacturing operations and has to be assessed under the head profits and gains of business . It was submitted that VAT refunds was towards tariffs paid on purchase of raw materials and intermediates. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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