2014 (12) TMI 353

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..... ocessed on 28.03.2003. Pursuant thereto, the case of the assessee was selected for scrutiny. During the scrutiny, the AO found that the assessee had ignored negative value of business profits and shown them to be nil. The AO was of the opinion that had the assessee not done the same, it would have resulted in a negative value of deduction under Section 80HHC of the Income Tax Act, 1961 (for short, 'the Act') and as a consequence thereof, the deduction allowable under the said section would have been 'Nil'. Hence, the AO determined deduction under Section 80HHC of the Act at 'Nil'. Being aggrieved thereby, the assessee approached the CIT(A), which partly allowed the appeal of the assessee. In turn, the revenue challen .....

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..... assessee, directing the AO to exclude excise duty and sales tax from the total turnover. Hence, the revenue has preferred the present appeal raising the following question of law, for the consideration of this Court.             "Whether on facts and circumstances of the case and in law, ITAT was right in law in holding that sums relatable to Excise duty and Sales tax do not form part of the total turn over for the purpose of computing profits derived from export for claiming benefit u/s 80HHC of the Income Tax Act, 1961?" 4. Mr. Parikh, learned Counsel for the appellant-revenue in both the appeals, submitted that the Tribunal erred by confirming the finding of the CIT(A) and directi .....

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..... t, and therefore, excise duty and sales tax also cannot form part of the "total turnover" under Section 80HHC(3) of the Act. 7. The aforesaid principle has also been followed by this Court in Tax Appeal No. 884 of 2006 and the allied matters, whereby, this Court also held that the amounts towards sales tax and the excise duty cannot be included in the total turnover. 8. It has come on record, in both the cases, while re-examining the case of the respective assessee, the AO included the amount towards Sales Tax as well as the Excise Duty in the total turnover. Therefore, in view of the above discussion and the principle laid down by the Apex Court in the above-mentioned decision and which is followed by this Court, as stated above, we are .....

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