9911796707
TMI Blog1998 (7) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... persons entered into a partnership to carry on business in hides and skins and tanning materials. One of the six died in the year 1981, and after his demise an agreement for dissolution was entered into by the surviving partners with the widow of the deceased partner in which it was recorded, inter alia, that the firm constituted under the partnership deed dated April 1, 1972, shall stand dissolved from September 30, 1981, that the credit balance standing in the name of the deceased partner shall be treated as a loan advanced to the company comprising of the surviving partners, and that the five surviving partners were authorised to continue the business under the same name and style of Balasubramaniam Bros. and Co., Pernambut, North Arcot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceased in the assets of the old firm, and the amount so determined continued to be available to the new firm and was used in the business of the new firm. It was submitted by counsel for the assessee that the Tribunal has misled itself in rejecting the claim made under section 80HHC of the Income-tax Act which enables the assessee to deduct certain amount from its export turnover. Before considering the arguments advanced before us, the provisions of section 80HHC of the Income-tax Act may first be referred to. It reads as under : "Deduction in respect of export turnover.---(1) Where the assessee, being an Indian company or a person (other than a company), who is resident in India, exports out of India during the previous year releva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt turnover, the benefit of the section being given to the assessee in its assessment. The substance of the matter therefore is the continuance of the export business and the increase in export of the qualifying goods. Counsel submitted that in this case the same firm, B. A. Balasubramaniam Bros and Co., had been engaged in export in the year 1972 and the partners of that firm continued the same business though under a different deed dated December 11, 1981, but the execution of the later document did not make any material change in the export business that was being carried on, and even under the agreement of dissolution they have exclusive right to carry on the business. Counsel submitted that the object of section 80HHC of the Income-t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rried on by the firm before reconstitution took place. Learned counsel for the Revenue relied on the decision of the apex court in CIT v. N. C. Budharaja and Co. [1993] 204 ITR 412, wherein it was observed that the principle of adopting a liberal interpretation which advances the purpose and object of beneficent provisions cannot be carried to the extent of doing violence to the plain and simple language used in the enactment. Section 80HHC is intended to encourage exports, as already noted. If the exports effected in the year previous to the assessment year are higher by 5 per cent. when compared to the exports of the immediately preceding year, the assessee would be entitled to the benefit of section 80HHC(1)(b) of the Act. When the e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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