9911796707
TMI Blog2023 (3) TMI 822X X X X Extracts X X X X X X X X Extracts X X X X ..... ome Tax Act, 1961 [the Act] for the AY 2018-19. 2. The brief facts of the case are that the assessee is a limited company engaged in the business of export of frozen shrimp and other sea foods filed its return of income for the AY 2018-19 declaring a total income of Rs. 102,53,82,880/-. After processing the return of income U/s. 143(1), the case was selected for complete scrutiny under CASS and accordingly statutory notices U/s. 143(2) and 142(1) were issued in electronic format to the assessee calling for the information. The assessee's representative filed its reply on line through e-filing portal. The case of the assessee was notified to ACIT, Central Circle-1, Visakhapatnam vide order U/s. 127 of the Act by the Pr. CIT-1, Visakhapatnam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 156/Viz/2021 (AY: 2017-18), dated 6/6/2022. The Ld. CIT(A) relying on the judgment of the Hon'ble Supreme Court in the case of CIT vs. Meghalaya Steels Limited (2016) 383 ITR 217 and the decision of the jurisdictional Bench in ITA No. 156/Viz/2022 (supra) allowed the appeal of the assessee. Aggrieved by the order of the Ld. CIT(A), the Revenue is in appeal before us. 4. The Revenue has raised six grounds in its appeal however, the only issue involved in the grounds of appeal was in relation to allowability of income under Duty Draw Back and MEIS scheme for the profits derived from eligible industrial undertaking for the purpose of claiming deduction U/s. 80IB of the Act. 5. The Ld. DR in his written submissions briefly explained the oper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lid. The Ld. AR also submitted that if there is no export sales, the assessee is not entitled for these incentives and hence it has direct link and nexus with the activities of the assessee industrial undertaking entitling deduction U/s. 80IB(11A) of the Act. The Ld. AR placed heavy reliance on the assessee's own case in ITA No. 156/Viz/2021 (supra) for the AY 2017-18. The Ld. AR therefore pleaded that the order of the Ld. CIT (A) be upheld. 6. We have considered the rival submission and perused the material available on record. The main contention of the Revenue is that the decision in the case of M/s. Meghalaya Steels Limited (supra) held by the Apex Court does not over ride the subsequent judgment of the Apex Court in M/s. Liberty India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... processing, preservation and packaging of fruits or vegetables or meat and meat products or poultry or marine or dairy products or from the integrated business of handling, storage and transportation of foodgrains, shall be hundred per cent of the profits and gains derived from such undertaking for five assessment years beginning with the initial assessment year and thereafter, twenty-five per cent (or thirty per cent where the assessee is a company) of the profits and gains derived from the operation of such business in a manner that the total period of deduction does not exceed ten consecutive assessment years and subject to fulfilment of the condition that it begins to operate such business on or after the 1st day of April, 2001 : Pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom income from other sources and not from profits and gains of business, which is a separate and distinct head as recognised by Section 14 of the Income Tax Act. Shri Radhakrishnan is not correct in his submission that assistance by way of subsidies which are reimbursed on the incurring of costs relatable to a business, are under the head "income from other sources", which is a residuary head of income that can be availed only if income does not fall under any of the other four heads of income. Section 28(iii)(b) specifically states that income from cash assistance, by whatever name called, received or receivable by any person against exports under any scheme of the Government of India, will be income chargeable to income tax under the hea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble Supreme Court has overruled its earlier decision in the case of Liberty India (supra) and now the decision in the case of Meghalaya Steel Ltd (supra) holds good. In the assessee's own case for the AY 2017-18, this Bench has held that the export entitlements is an income assessable under the head "profits or gains from business or profession" as per clause (iiib) and (iiid) to section 28 of the IT Act, 1961. Respectfully following the above precedents, we hold that the export incentives such as Duty Draw Back and MEIS is an income assessable under the head 'profits or gains from business or profession' as per clause (iiib) and (iiid) to section 28 of the Act. In view of the above, the grounds raised by the Revenue are dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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