2015 (8) TMI 507

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..... fter referred to as "the Act"). 2. It is not in dispute that the assessee exported rice to Pnomphenh, Cambodia through State Trading Corporation of India Ltd. (for short hereinafter referred to "the "STC"), Jalandhar, as a supporting manufacturer and, therefore, they claimed deduction under section 80HHC of the Act. The assessee produced a letter dated November 28, 2003, from the STC to the effect that the STC had not claimed any export benefit on the said exports and that the said exports are under protocol exports, i.e., Government of India to Government Aid Programme and that the export consideration was received in Indian rupees from the Ministry of External Affairs. A certificate of disclaimer from the STC in the prescribed Form 10CCA .....

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..... ed in section 80HHC(1A) of the Act the supporting manufacturer is entitled to the said benefit. Aggrieved by the said order, the Revenue is in appeal. 5. The learned counsel appearing for the Revenue assailing the impugned order contended that when the export house has not earned any profit, the question of passing on the said benefit to the supporting manufacturer does not arise. Secondly, the Government of India gifted the rice to Cambodia and it is not a sale and no foreign exchange is realised and, therefore, he submits section 80HHC of the Act has no application to the facts of this case. 6. Per contra, the learned counsel for the assessee submitted that the present case falls under section 80HHC(1A) of the Act and all the conditions .....

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..... or merchandise to the export house or trading house, the export house and trading house has to issue a certificate under the proviso to sub- section (1) of section 80HHC of the Act. If these two conditions are fulfilled, then the supporting manufacturer is entitled to the deduction as contemplated under section 80HHC of the Act to an extent as mentioned in section 80HHC(1B) of the Act. It is immaterial whether in the process, export house or trading house sells the goods to any foreign country or earns profit or realises any foreign exchange. In order to attract section 80HHC(1A) of the Act after purchase of goods or merchandise from the supporting manufacturer, the said goods has to be exported out of India. Once such export is establishe .....

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