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TMI Blog2013 (12) TMI 541X X X X Extracts X X X X X X X X Extracts X X X X ..... sing the following questions of law :- Tax Case (A).No.1013, 401 and 567 of 2009:- 1. Whether on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the assessee a supporting manufacturer was entitled to deduction under Section 80 HHC in respect of the DEPB and Duty Draw Back disclaimed in its favour by the exporter ? 2. Whether on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the assessee a supporting manufacturer was entitled to deduction under Section 80 HHC in respect of the DEPB and Duty Draw Back disclaimed in its favour by the exporter without taking note of the third Proviso to Sub Section (3) of Section 80HHC and the difference betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vs. Baby Marine Exports, the Income Tax Appellate Tribunal allowed the case of the assessee as regards the exclusion of duty drawback for the purpose of working out the relief under Section 80 HHC of the Income Tax Act, 1961 (hereinafter called as the "Act"). 4. The assessee herein is a supporting manufacturer, which manufactured and exported cotton textiles through their export house M/s.Ikea Trading (I) Limited., New Delhi. In respect of the sale effected, the assessee received the value of the duty drawback available to the export house viz., M/s.Ikea Trading (I) Limited. The assessee included the duty drawback as part of its deduction under Section 80 HHC of the Act. According to the Assessing Officer, under Section 80 HHC 3(A) deduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ea that duty drawback should be considered for arriving at the profit for the purpose of computing deduction at 80 HHC of the Act. 8. Aggrieved by this, the assessee went on appeal before the Income Tax Appellate Tribunal, who followed the decision reported in (2007) 290 ITR 223 in the case of Commissioner of Income Tax Vs. Baby Marine Exports and allowed the assessee's appeal. Aggrieved by this, the present Tax Case (Appeals) by the Revenue. 9. Learned Standing Counsel appearing for the Revenue placed reliance on the decision reported in (2012) 342 ITR 49 in the case of Topman Exports Vs. Commissioner of Income Tax and submitted that considering the decision of the Apex Court particularly in paragraph No.14, that the assessee should prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts on Duty Entitlement Passbook Scheme (DEPB) is concerned, the same would be part of the profits and gains of the business, it being the assistance given by the Government of India to an exporter to pay customs duty on its imports, therefore, the "cash assistance" received under the DEPB scheme would fall under Clause (iiib) of Section 28 and is chargeable to income-tax under the head "Profits and gains of business or profession" even before it was transferred to the assessee by the export house. Thus, the Apex Court held that there was no justification to treat the amount which is received by an exporter on the transfer of the DEPB any differently than the profits which are made on the sale of an import licence under clause (iiia) of Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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