9911796707
TMI Blog2014 (12) TMI 176X X X X Extracts X X X X X X X X Extracts X X X X ..... ge fluctuation receipts –Held that:- Definitely, exchange fluctuation gain in respect of realization of export proceeds of current years is to be included in the profit of the business of the present year and same is also to be included in the export turnover and total turnover of the present year but if such exchange fluctuation gain is in respect of export of any earlier year then the same can neither be included in the business profit of the present year nor it can be included in the export turnover and total turnover - The same should relate back to the year of export and in that year, it should be included in business profit as well as export turnover and total turnover - Since the finding of CIT(A) is not on this line, the order of CIT(A) on this issue is not sustainable – thus, the matter is remitted back to the CIT(A) for fresh decision – Decided in favour of revenue. Interest income to be included under income from other sources or business income – Held that:- Following the decision in CIT vs. Jyoti Apparels [2007 (1) TMI 542 - DELHI HIGH COURT] - interest earned on FDR even for the purpose of availing credit facilities from bank does not have immediate nexus with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of the AO and the submissions of the appellant through Ld. AR, relevant part of which has been reproduced above. The claim of Bad debts defined in the Section 36(1)(vii) of the Income Tax Act, 1961 provides that - No such deduction shall be allowed unless such debt or part thereof has been taken into account in computing the income of the assessee of the previous year in which the amount of such debt or part thereof is written off or of an earlier previous year, or represents money lent in the ordinary course of business or money lending which is carried on by the assessee . The assessee vide written submissions dated 20.02.2006 and 07.11.2006 has already enclosed the export sales and also the RBI approvals for the export sales which have been written off during the year under consideration. Thus, in my view there is sufficient evidence in the form of RBI approval and books of assessee for the purpose of allowance of bad debts amounting to ₹ 1,55,057/-, Hence, the addition made by AO is deleted. For advance for expenses amounting to ₹ 1,50,000/-, the same was given as a advance for advertisement expenses- like making of glow sign boards etc. and the same was not retu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... garding deleting interest income of ₹ 41,55,388/-, he placed reliance on the judgment of Hon'ble Delhi High Court rendered in the case of CIT vs. SHRI RAM HONDA POWER EQUIP ORS as reported in [2007] 207 CTR 689. He also placed reliance on the judgment of Delhi High Court in the case of CIT vs. Jyoti Apparels [2008] 166 Taxman 343 (Del). 8. As against this, Learned A.R. of the assessee supported the order of learned CIT(A). He also placed reliance on a decision of Special Bench of the Tribunal in the case of Assistant Commissioner of Income-tax, Circle 16(1), Mumbai v. Prakash L. Shah [2008] 115 ITD 167. He also placed reliance on a judgment of Hon'ble Bombay High Court rendered in the case of CIT vs. Rachna Udhyog [2010] 35 DTR 65. Reliance was also placed on the Tribunal decision in the case of ACIT vs. Headstrong Services India Pvt. Ltd. in I.T.A. No.4181/Del/2010 dated 31/07/2012. Reliance was also placed on the following judicial pronouncements: (i) Commissioner of Income-tax Vs S.S.C. Shoes Ltd. [2005] 275 ITR 46 (Jhar) (ii) Commissioner of Income-tax Vs Punit Commercial Ltd. [2000] 245 ITR 550 (Bom) (iii) Commissioner of Income-tax Vs J.K. Hosiery ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable. In the latest case, it was held by Hon'ble Delhi High Court that interest earned on FDR even for the purpose of availing credit facilities from bank does not have immediate nexus with the export business and therefore, it has to be necessarily treated as income from other sources and not business income. Hence, respectfully following this judgment of Hon'ble Delhi High Court, we hold that interest income in the present case cannot be treated as business profit for the purpose of computing deduction allowable to the assessee u/s 80HHC. Accordingly, ground No. 3 is allowed. 13. Now we deal with ground No. 4 of the Revenue i.e. regarding misc. receipt. We find that although it was the claim of the assessee that misc. receipt is on account of sale of scrap etc. and tax was paid thereon but it is noted by the Assessing Officer on page No. 7 of the assessment order that as per the reconciliation of the sales with sales tax order, it was found that ₹ 8,75,170/- is of the nature which was not subjected to sales tax. Only to this extent, it was held by the Assessing Officer that the misc receipt is to be treated to be of the nature as envisaged in clause (baa) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efeated even by the decision of Hon'ble apex court in the case of Liberty India Vs. CIT in (2009) 317 ITR 218, as has been referred to and relied upon by the CIT(Appeals) . 5. BECAUSE in any case and without prejudice to the contentions raised in the foregoing grounds No. 1, 2, 3 4 above, for the purposes of exclusion from eligible profit, only such amount of duty draw back should have been considered as arrived at after adjusting the expenses incurred in earning such duty draw back . 6. BECAUSE alternate claim for relief under section 80HHC was liable to be considered and allowed with reference to the income earned, without any adjustment on account of duty draw back as received by the appellant and not even by the net amount of duty draw back (as arrived at after considering the expenditure incurred in earning the same). 7. BECAUSE the CIT(Appeals) erred in law and on facts in not allowing the benefit of exemption while computing the deduction under section 80HHC on ₹ 2,26,613/- made up as under:- (i) scrap sales of mini boiler : ₹ 90,000 (ii) other misc. receipts : ₹ 1,36,613 by invoking clause (baa) of sub-section 4B of section ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
