9911796707
TMI Blog2005 (12) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court X X X X Extracts X X X X X X X X Extracts X X X X ..... ion (1B) derived by the assessee from the export of such goods or merchandise: Provided that if the assessee, being a holder of an Export House Certificate or a Trading House Certificate (hereafter in this section referred to as an Export House or a Trading House, as the case may be), issues a certificate referred to in clause (b) of sub-section (4A), that in respect of the amount of the export turnover specified therein, the deduction under this sub-section is to be allowed to a supporting manufacturer, then the amount of deduction in the case of the assessee shall be reduced by such amount which bears to the total profits derived by the assessee from the export of trading goods, the same proportion as the amount of export turnover specif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section shall be further increased by the amount which bears to ninety per cent, of any sum referred to in clause (iiia) (not being profits on sale of a licence acquired from any other person), and clauses (iiib) and (iiic) of section 28, the same proportion as the export turnover bears to the total turnover of the business carried on by the assessee. Explanation.- For the purposes of this sub-section,- (a) 'adjusted export turnover' means the export turnover as reduced by the export turnover in respect of trading goods; (b) 'adjusted profits of the business' means the profits of the business as reduced by the profits derived from the business of export out of India of trading goods as computed in the manner provided in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, the taxable income before the deductions under Chapter VI-A came to ₹ 4.39 crores. The appellants therein, however, claimed various deductions in terms of section 80HHC to the extent of ₹ 3.78 crores. It was found that the sum of ₹ 3.78 crores claimed for deduction was the profit for exports of self-manufactured goods. It was further found that from the exports of trading goods there was a loss of ₹ 6.86 crores. The question which arose for consideration was as to whether the appellants were entitled to deduction under section 80HHC in respect of the sum of ₹ 3.78 crores ignoring the loss of ₹ 6.86 crores. This court repelled the contention that even when the profits are to be reduced by the losses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee who appeared on the appointed day, contended that, though the assessee earned export profit, it resulted in the negative figure owing to the provisions in section 80HHC(3); that, in such a situation, the profit should be taken at nil and relief should be allowed having regard to the export incentives (viz., advance licences); that as section 80HHC is benefit giving section it should be liberally construed; that the Appellate Tribunal in the case of A.M. Mossa v. CIT, ITAT Cochin Bench, I.T.A. No. 498/Cochin of 1995, supports this view, and that the assessment order is not erroneous." It may, therefore, be necessary, in our opinion, to consider this aspect of the matter as to whether the appellant had shown any positive profit or no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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