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TMI Blog2017 (3) TMI 482X X X X Extracts X X X X X X X X Extracts X X X X ..... ”. After analyzing the provision, it was held by the Hon'ble Supreme Court that the DEPB is an incentive. It is given under Duty Exemption Remission Scheme. Essentially, it is an export incentive. No doubt, the object behind DEPB is to neutralize the incidence of customs duty payment on the import content of export product. This neutralization is provided for by credit to customs duty against export product. Hon'ble Supreme Court has held that the duty drawback receipt/DEPB benefits do not form part of the net profits of eligible industrial undertaking for the purposes of Sections 80I/80IA/80IB of the Act. - Decided aganst assessee - ITA No. 285 to 288/JP/2016 - - - Dated:- 30-1-2017 - Shri Bhagchand, Am And Shri Kul Bharat, JM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... am Udyog Yojana) from Government of India under its Schemes framed to encourage such manufacturers and Exporters. (ii) Ld. CIT(A) was not justified in denying legally entitled deduction of ₹ 4,76,659/- under section 80IB of IT Act, which is equal to 25% of the cash assistance of ₹ 19,06,636/- under DEPB and VKGUY by treating the said receipts as incentive though such receipts are specifically categorized under the statute as profit and gains of business or profession under section 28(iiib)/28(iiid) of IT Act. In all the other appeals also, the assessees have taken similar identical grounds mentioned above. 4. At the time of hearing, the ld. Counsel of the assessee has submitted that he does not wish to press g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utation in accordance with law laid down in the case of Topman Exports (2012) 342 ITR 49 (SC). He placed reliance on the decision in the case of Nissan Exports Vs. CIT (2014) 360 ITR 93 (SC) and Global Agro Products Pvt. Ltd. Vs. ITO (2014) 360 ITR 117 (SC). Ld. AR submitted that in the case of Topman Exports Vs. CIT (2012) 342 ITR 49 (SC), it was held that DEPB credit is cash assistance receivable by a person against export under the scheme of the Government of India and falls under clause (iiib) (iiid) of Section 28 of the Act and is chargeable to income tax under the head profit and gains from business or profession . He submitted that following the judgments of the Hon'ble Supreme Court in the cases of Nissan Exports Vs. CIT (sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m any business referred to in Sub-section (3) to (11), such business being as the eligible business. He submitted that the assessee has to demonstrate that the profit and gains which is claiming as a deduction should be derived from the eligible business. He submitted that what the assessee is claiming is not derived from the eligible business, therefore, the authorities below were justified in declining the claim of deduction U/s 80IB of the Act. 9 We have heard the rival contentions of both the parties, perused the material available on the record and also gone through the orders of the authorities below. The Assessing Officer noted that the assessee has claimed an amount of ₹ 17,38,256/- under the head V.K.G.U.Y (Vishesh Krishi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spect of profits and gains derived from the eligible business. It is held by the Hon'ble Supreme Court that the words derived from is narrower in connotation as compared to the words attributable to . In other words, by using the expression derived from , Parliament intended to cover sources not beyond the first degree. After analyzing the provision, it was held by the Hon'ble Supreme Court that the DEPB is an incentive. It is given under Duty Exemption Remission Scheme. Essentially, it is an export incentive. No doubt, the object behind DEPB is to neutralize the incidence of customs duty payment on the import content of export product. This neutralization is provided for by credit to customs duty against export product. Hon' ..... X X X X Extracts X X X X X X X X Extracts X X X X
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