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TMI Blog2021 (1) TMI 295X X X X Extracts X X X X X X X X Extracts X X X X ..... of the above distinguishing facts, the ratio of the decision of the Tribunal (supra) cannot be applied in the instant case without verifying the facts. It is also not clear from the order of the Assessing Officer in the instant year, whether the FDR were made for the purpose of the business or for merely earning interest income. No such details have been provided before us also. Thus restore the issue in dispute to the file of the Assessing Officer for deciding in accordance with law - ITA Nos. 4468 And 4469/Del./2017 - - - Dated:- 8-1-2021 - Shri Bhavnesh Saini, Judicial Member And Shri O.P. Kant, Accountant Member For the Appellant : Shri K.V.S.R. Krishna, Adv. For the Respondent : Ms. Nidhi Srivastava, CIT(DR) ORDER PER O.P. KANT, AM: These two appeals by the assessee are directed against a common order dated 30/03/2017 passed by the learned CIT(Appeals)-31, New Delhi [in short the Ld. CIT(A) ] for assessment years 2010-11 and 2011-12 respectively. As common issue in dispute are involved in both the appeals, same were hard together and disposed off by way of this consolidated order for convenience. 2. The grounds raised in ITA No. 4468/Del/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d submissions through emails. The Learned Counsel of the assessee filed a paper-book containing case laws. 5. Before us, the Learned Counsel of the assessee submitted that case of the assessee is fully covered by the decision of the Tribunal in the case of the assessee for assessment year 2008-09 and 2006-07 and following three decisions: 1. PCIT Vs. Dishman Pharmaceutical and Chemicals Ltd. [2019], 417 ITR 313 (Guj.) 2. Riviera Home Furnishing Vs. Additional CIT [2017] 9 ITR OL 401 (Del.) 3. CIT Vs. Hritik Exports Pvt. Ltd., [2015] 4 ITR OL 267 (DEL) 6. The learned Counsel submitted that in the above decisions, it is held that for the claim of deduction under section 10A/10B of the Act, the profit and gains of the undertaking should be considered, which include income like provisions written back, interest on FDR, sale of the scrap and any other income which forms part of the profit and gains of the business and profession. He further submitted that interpretation derived from in respect of the cases covered under chapter VIA would not apply to the claim under section 10B of the Act which is governed by specific provision namely 10B(4) of the Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 62. In view of the aforesaid discussion, we hold that the dividend income, profit on sale of fixed assets, profit on sale of investments, excess provision / return back, duty drawback and interest income could be said to have direct nexus with the income of the business of the undertaking. Although it may not partake of the character of profit and gain from the sale of article, yet it could be termed as an income derived from the consideration realized by the export articles. In view of the definition of income from profits and gains incorporated in sub-section (4), the Tribunal committed no error in granting the benefit of exemption, as contemplated under section 10B of the Act. 9.2 In the case of Riviera Home Furnishing (supra), the Hon ble Delhi High Court after taking into consideration its decision in the case of Hritnik Exports P. Ltd (supra) held as under: 17. The contention of the Assessee as regards customer claims was that it had received the claim of ₹ 28,27,224 from a customer for cancelling the export order. Later on the cancelled order was completed and goods were exported to another customer. The sum received as claim from the customer was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the special bench of the Tribunal in the case of Maral Overseas Ld. Vs. ACIT, ITA Nos. 777 999 (Ind) of 2004 295 356 (Ind) of 2006 dated 28.3.2012, where it is held that in the case of Liberty India, the Hon'ble Supreme Court has dealt with the provisions of section 80lA/80IB of the Act and not section 10B where a formula has been prescribed u/s 10B(4), the application of which would result in arriving at the figure of profits and gains that are to be considered as derived by the 100% EOU, for the purpose of computing exemption u/s 10B (1) Thus a disallowance on the ground that a particular income is not derived from the business is bad in law as the same does not confirm to the formula prescribed under the Act. Ground No. 2 is same as ground No. 1. Hence both ground No. 1 2 are dismissed. 9.4 The finding of the Tribunal in assessment year 2006-07 on the issue of the interest and miscellaneous income is reproduced as under: 9. The first issue is regarding the deletion of addition of ₹ 15,94,813/- by the Ld. CIT(A) on account of disallowance of interest, on interest free loan of ₹ 2.64 crores advanced to a subsidiary company. The first appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment year 2006-07 held that amount in question was not interest on loan, but it was investment made in purchase of shares of subsidiary company for the purpose of having control over it. In view of the above distinguishing facts, the ratio of the decision of the Tribunal (supra) cannot be applied in the instant case without verifying the facts. It is also not clear from the order of the Assessing Officer in the instant year, whether the FDR were made for the purpose of the business or for merely earning interest income. No such details have been provided before us also. In view of the facts and circumstances, we feel it appropriate to restore the issue in dispute to the file of the Assessing Officer for deciding in accordance with law after verifying the source of miscellaneous income and the interest income. It is needless to mention that assessee shall be provided adequate opportunity of being heard. The ground No.2 of the appeal is accordingly allowed for statistical purposes. 10. Ground No. 3 and 4 being general in nature, we are not required to adjudicate upon; accordingly, same are dismissed as infructuous. 11. In ITA No. 4469/del/2017 for assessment year 2011 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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