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TMI Blog2005 (12) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 80HHC(4B) would not include receipt on account of exchange rate difference?" - - - - - Dated:- 20-12-2005 - Judge(s) : D. A. MEHTA., MS. H. N. DEVANI. JUDGMENT The judgment of the court was delivered by D.A. Mehta J.-The appellant-Revenue has proposed the following three questions: "(A) Whether, on the facts and circumstances of the case and in law, the Tribunal was justified in holding that the exchange rate difference pertaining to exports made in earlier years was 'profit of business' within the meaning of section 80HHC of the Act? (B) Whether, on the facts and in the circumstances of the case and in law, the Tribunal was justified in holding that the issue was squarely covered by the decision of the jurisdictional Hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer came to the conclusion that the exchange rate difference on export realisation for prior period, i.e., up to March 31, 2000, being Rs. 13,18,068 was not an allowable deduction. The assessee carried the matter in appeal but did not succeed. Hence, the assessee preferred second appeal before the Tribunal. The Tribunal has upheld the claim made by the assessee on the basis of the decision of this High Court in the case of Hindustan Trading Corporation v. CIT [1986] 160 ITR 15 by treating the receipt in question as being on revenue account. The Tribunal has also placed reliance on various other decisions of different Benches of the Tribunal. Assailing the impugned order of the Tribunal, Mr. M.R. Bhatt, learned senior standing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear subsequent to the year of exports. As can be seen from the assessment order it talks of export realisation for exports made up to March 31, 2000. There is nothing to indicate, and none of the authorities have applied their mind, as to whether the sum of Rs. 13,18,068 is relatable to exports made during only one financial year or more than one financial year preceding March 31, 2000. This would have a material bearing, taking into consideration the provisions of sub-section (2) of section 80HHC of the Act as was applicable during the year under consideration. Under sub-section (2) of section 80HHC of the Act, sale proceeds of goods or merchandise exported out of India and received in convertible foreign exchange become entitled to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... situation where a larger amount is received than the amount as reflected in the shipping bill. Hence, merely because an amount is received in a year subsequent to the year of export by way of exchange rate difference, it does not necessarily always follow that the same is not relatable to the exports made. As can be seen from the impugned order of the Tribunal as well as the orders of the Commissioner (Appeals) and the Assessing Officer, none of the authorities have approached the issue in the light of the provisions of sub-section (2) of section 80HHC of the Act. No evidence is available on record to establish fulfilment or otherwise, of the conditions stipulated by sub-section (2) of section 80HHC of the Act. In these circumstances, it ..... X X X X Extracts X X X X X X X X Extracts X X X X
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