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TMI Blog2015 (8) TMI 507X X X X Extracts X X X X X X X X Extracts X X X X ..... ese 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 established, a certificate under the proviso to sub-section (1) is issued by the export house or trading house and when they are not claiming the benefit under section 80HHC, the assessee would be e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gar, pulses and export of rice. For the assessment year 2003-04, the assessee filed a return of income declaring the total income of ₹ 2,20,55,450 after claiming the deduction of ₹ 80,95,064 under section 80HHC of the Income-tax Act, 1961 (for short hereinafter 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irect Taxes dealing with the protocol exports, it was held that the supporting manufacturer has realised the consideration in Indian currency. Whether the Government of India has realised some foreign currency is not the criteria. In view of the specific provision as contained 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 n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection (1B), derived by the assessee from the sale of goods or merchandise to the Export House or Trading House in respect of which the certificate has been issued by the Export House or Trading House. 9. To attract the said provision, the supporting manufacturer who sells the goods 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 se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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