M/s Shakti Impex, Ahmedgarh. V. ITO, Malerkotla

ITA 153/CHANDI/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7089 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 6 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 11-08-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 11-02-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Benefit of exemption
• Section: 143(3); 80IB; 10B; 263; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A CHANDIGARH BEFORE SHRI T.R.SOOD ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO. 153/CHD/2013 ASSESSMENT YEAR : 2009-10 M/S SHAKTI IMPEX, VS THE INCOME TAX OFFICER , JAGERA ROAD, IV (4), H.O. MALERKOTLA. AHMEDGARH. PAN : AAXFS1081J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHWANI KUMAR RESPONDENT BY : SHRI MANJIT SINGH DATE OF HEARING : 11.08.2014 DATE OF PRONOUNCEMENT : 28.08.2014 O R D E R PER SUSHMA CHOWLA, JM THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-II, LUD HIANA DATED 27.12.2012 RELATING TO ASSESSMENT YEAR 2009-10 AGAI NST THE ORDER PASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT'). 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUND OF APPEAL : THAT ORDER PASSED UNDER SECTION 250(6) OF THE INCO ME TAX ACT,1961 BY THE LD. COMMISSIONER OF INCOME TAX (APP EALS)- II LUDHIANA IS AGAINST LAW AND FACTS ON THE FILE IN AS MUCH AS HE WAS NOT JUSTIFIED TO ARBITRARILY UPHOLD THE A CTION OF THE LD. ASSESSING OFFICER IN DISALLOWING CLAIM OF D EDUCTION UNDER SECTION 80IC ON THE AMOUNTS RECEIVED AS DUTY DRAW BACK AT RS. 25,88,032/- AND UNDER VISHESH KRISHI UP AJ YOJNA AT RS. 1,20,08,028/-. 2 3. THE ISSUE RAISED IN THE PRESENT APPEAL IS IN REL ATION TO THE ALLOWABILITY OF CLAIM OF DEDUCTION UNDER SECTION 80 IC OF THE ACT ON DUTY DRAW BACK AT RS. 25,88,032/- AND UNDER VISHESH KRISHI UPAJ YOJNA AT RS. 1,20,08,028/-. IT WAS FAIRLY CONCEDED BY THE LD. AR FOR THE ASSESSEE THAT SIMILAR ISSUE HAD ARISEN IN THE C ASE OF M/S LITTLE BEE IMPEX VS DCIT RELATING TO ASSESSMENT YEAR.2006-07 A ND OTHERS WHEREIN IT WAS HELD THAT THE ASSESSEE WAS NOT ENTIT LED TO THE DEDUCTION UNDER SECTION 80IC OF THE ACT ON SIMILAR RECEIPTS. 4. THE LD. DR FOR THE REVENUE PLACED RELIANCE ON TH E ORDERS OF THE AUTHORITIES BELOW. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION WAS EN GAGED IN THE PROCESSING AND EXPORT OF HONEY, TRADING OF ZINC AND MUSTARD OIL. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AS SESSING OFFICER NOTED THAT THE ASSESSEE HAD DECLARED RECEIPT OF RS. 25,88,032/- ON ACCOUNT OF DUTY DRAW BACK AND UNDER THE HEAD VISHES H KRISHI UPAJ YOJNA AT RS. 1.20 CRORES. THE ASSESSING OFFICER NO TED THAT SIMILAR RECEIPT OF DUTY DRAW BACK AND VISHESH KRISHI UPAJ Y OJNA WERE RECEIVED IN THE EARLIER YEAR AND DEDUCTION CLAIMED UNDER SECTION 80IC OF THE ACT WAS WITHDRAWN BY PASSING ORDER UNDER SEC TION 263 OF THE INCOME TAX ACT. THE ASSESSEE WAS SHOW CAUSED TO EX PLAIN WHY DEDUCTION UNDER SECTION 80IC OF THE ACT SHOULD NOT BE WITHDRAWN ON THE SAID RECEIPTS. IN REPLY, THE ASSESSEE CLAIMED THAT THE SAID INCENTIVES WERE RECEIVED AFTER PROCESS OF HONEY AND WERE ISSUED BY THE GOVERNMENT OF INDIA AND THE STATE GOVERNMENT TO PRO MOTE THE EXPORT OF INDIAN GOODS/ARTICLES. THE ASSESSEE, THUS SUBMI TTED THAT THE SAID DEDUCTION UNDER SECTION 80IC OF THE ACT WAS ALLOWAB LE TO THE ASSESSEE. HOWEVER, THE ASSESSING OFFICER IN VIEW OF VARIOUS D ECISIONS OF THE APEX COURT HELD THAT THE ASSESSEE WAS NOT ENTITLED TO THE DEDUCTION 3 CLAIMED UNDER SECTION 80IC OF THE ACT AND THE INCOM E IN THE HANDS OF THE ASSESSEE WAS THUS, RECOMPUTED. 6. THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD THE ADDITION MADE BY THE ASSESSING OFFICER IN VIEW OF THE JUDGEM ENT OF THE HON'BLE SUPREME COURT IN CIT VS STERLING FOODS LTD.237 ITR 579 (S.C) AND LIBERTY INDIA VS CIT 317 ITR 218 (S.C). 7. ON THE PERUSAL OF THE RECORD, WE FIND THAT SIMIL AR ISSUE OF ALLOWABILITY OF DEDUCTION UNDER SECTION 80IC OF THE ACT ON THE RECEIPTS FROM VISHESH KRISHI UPAJ YOJNA AROSE BEFORE THE TRI BUNAL IN THE CASE OF M/S LITTLE BEE IMPEX VS DCIT (SUPRA) WHEREIN VID E ORDER DATED 03.01.2014, THE TRIBUNAL HELD AS UNDER : 50. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE RECORD. THE ASSESSEE DURING THE YEAR UNDER CONSIDER ATION HAD RECEIVED INCENTIVES FROM MINISTRY OF COMMERCE, GOVE RNMENT OF INDIA UNDER VISHESH KRISHI UPAJ YOJNA @ 5% OF FOB VALUE OF EXPORTS. DURING THE YEAR UNDER CONSIDERATION TH E ASSESSEE HAS BOOKED INCENTIVES FOR THE FINANCIAL YEAR 2005-0 6 AND 2004-05 ON ACCRUAL BASIS. THE DETAILS OF THE INCEN TIVES ACCRUED/RECEIVED WERE FILED BEFORE THE ASSESSING OF FICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS AS IS A PPARENT FROM THE LETTER DATED 28.11.2008 PLACED AT PAGES 65 TO 72 OF THE PAPER BOOK TO WHICH THE DETAILS WERE ANNEXED AS ANNEXURE-I. THE SAID LICENCES ARE GRANTED BY THE D GFT, MINISTRY OF COMMERCE AND IS EQUIVALENT TO 5% OF FOB VALUE OF THE EXPORTS MADE BY THE ASSESSEE, WHICH IN TURN IS CALCULATED ON THE BASIS OF SHIPPING BILLS/BRCS FILED WITH DGFT . THE VALUE OF LICENCES WORKED TO RS.2.23 CRORES ON EXPOR T SALES OF RS.46.46 CRORES FOR FINANCIAL YEAR 2005-06 AND RS.7 6.33 LACS ON EXPORT SALES OF 16.17 CRORES RELATING TO FINANCI AL YEAR 2004-05. THE SAID LICENCES WERE SOLD BY THE ASSE SSEE DURING THE YEAR UNDER CONSIDERATION FOR RS.2.16 CRORES AND RS.61 LACS RESPECTIVELY TOTALING RS.2.78 CRORES. FURTHER AMOU NT OF RS.30 LACS WAS PROVIDED ON ESTIMATE BASIS FOR PENDING LIC ENSES AND THE INCOME OF RS.2.80 CRORES WAS SHOWN IN THE BOOKS OF ACCOUNT ON THE BASIS OF ACTUAL SALE PRICE OF THE LICENCES/PROVISION. THE DEDUCTION UNDER SECTION 10 B OF THE ACT ON THE SAME HAD BEEN CLAIMED AT RS.2,57,88,457/ -. IN THE FIRST INSTANCE WHERE THE QUERIES HAD BEEN RAISED BY THE ASSESSING OFFICER, WHICH IN TURN HAD BEEN REPLIED T O BY THE ASSESSEE AND THE ISSUE HAVING BEEN CONSIDERED BY TH E ASSESSING OFFICER AND ONE POSSIBLE VIEW OF ALLOWING THE DEDUCTION UNDER SECTION 10B OF THE ACT HAVING BEEN PASSED, THE ISSUE ARISES, WHETHER THE SAME IS OPEN TO REVIS ION UNDER SECTION 263 OF THE ACT. THE HON'BLE COURTS HAVE HEL D THAT THE 4 COMMISSIONER OF INCOME TAX BY WAY OF THE PROCEEDING S INITIATED UNDER SECTION 263 OF THE ACT IS NOT EMPOW ERED TO SUBSTITUTE ONE VIEW ADOPTED BY THE ASSESSING OFFICE R BY ANOTHER VIEW IN THIS REGARD. IN VIEW THEREOF, THE ORDER OF REVISION ORDER PASSED UNDER SECTION 263 OF THE ACT BY THE COMMISSIONER OF INCOME TAX IS WITHOUT JURISDICTION OR NOT IS TO BE SEEN IN LINE WITH THE ALLOWABILITY OF THE SAI D CLAIM IN THE HANDS OF THE ASSESSEE. 51. UNDER THE SAID SECTION 10B OF THE ACT IT IS PRO VIDED THAT DEDUCTION OF SUCH PROFITS AND GAINS AS ARE DERIVED BY A HUNDRED PER CENT EXPORTS ORIENTED UNDERTAKING FROM THE EXPORT OF ARTICLES OR THINGS FROM THE YEAR IN WHICH THE UN DERTAKING BEGINS TO MANUFACTURE THE ARTICLES OR THINGS, DEDUC TION IS TO BE ALLOWED ON THE TOTAL INCOME OF THE ASSESSEE. TH E ASSESSEE IS ADMITTEDLY ENGAGED INTO HUNDRED PER CENT EXPORTS AND IS A HUNDRED PER CENT EOU UNIT. WE HAVE ALREADY HELD TH E ASSESSEE TO BE ENTITLED TO THE CLAIM OF DEDUCTION U NDER SECTION 10B OF THE ACT IN THE ABOVE SAID PARAS. NOW THE ON LY ISSUE TO BE SEEN IS WHETHER THE RECEIPTS AS SUCH I.E. THE IN CENTIVES RECEIVED UNDER VISHESH KRISHI UPAJ YOJNA, WHICH I N TURN IS DETERMINED @ 5% AND THE FOB VALUE OF THE EXPORT SAL ES MADE BY THE ASSESSEE, IS DERIVED FROM THE UNDERTAKING. BOTH THE COMMISSIONER OF INCOME TAX AND THE LEARNED D.R. FOR THE REVENUE HAVE PLACED RELIANCE ON THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN LIBERTY INDIA VS. CIT (SUP RA) TO HOLD THAT THE ASSESSEE IS NOT ENTITLED TO THE SAID DEDUCTION. 52. THE PERUSAL OF THE SAID DECISION REFLECTS THAT THE ISSUE BEFORE THE HON'BLE SUPREME COURT IN LIBERTY INDIA V S. CIT (SUPRA) WAS THE CLAIM OF DEDUCTION U/SS 80I/80IA AN D 80IB OF THE ACT WHICH ALSO PROVIDES FOR DEDUCTION WITH REFE RENCE TO THE PROFITS DERIVED FROM ELIGIBLE BUSINESS. THE HO N'BLE APEX COURT IN LIBERTY INDIA VS. CIT (SUPRA) OBSERVED AS UNDER : THE INCOME-TAX ACT, 1961, BROADLY PROVIDES FOR TWO TYPES OF TAX INCENTIVES, VIZ., INVESTMENT-LINKED IN CENTIVES AND PROFIT-LINKED INCENTIVES. CHAPTER VI-A OF THE ACT WHICH PROVIDES FOR INCENTIVES IN THE FORM OF DEDUCTIONS E SSENTIALLY BELONGS TO THE CATEGORY OF PROFIT-LINKED INCENTIVE S. THEREFORE, WHEN SECTION 80-IA/80-IB REFERS TO PROFI TS DERIVED FROM ELIGIBLE BUSINESS, IT IS NOT THE OWNERSHIP OF THAT BUSINESS WHICH ATTRACTS THE INCENTIVES: WHAT ATTRACTS THE IN CENTIVES UNDER SECTION 80-IA/80IB IS THE GENERATION OF PROFI TS (OPERATIONAL PROFITS). IT IS FOR THIS REASON THAT PARLIAMENT HAS CONFINED DEDUCTION OF PROFITS DERIVED FROM ELIGIBLE BUSINESS MENTIONED IN SUB-SECTIONS (3) TO (11A). EACH OF TH E BUSINESSES MENTIONED IN SUB-SECTIONS (3) TO (11A) C ONSTITUTES A STAND-ALONE ITEM IN THE MATTER OF COMPUTATION OF PR OFITS. SECTIONS 80-IB AND 80-IA ARE A CODE BY THEMSELVES AS THEY CONTAIN BOTH SUBSTANTIVE AS WELL AS PROCEDURAL PROVISIONS. SECTION 80-IB PROVIDES FOR THE ALLOWING OF DEDUCTIO N IN RESPECT OF PROFITS AND GAINS DERIVED FROM THE ELIGI BLE BUSINESS. THE CONNOTATION OF THE WORDS DERIVED FROM IS NARR OWER AS COMPARED TO THAT OF THE WORDS ATTRIBUTABLE TO. B Y USING THE 5 EXPRESSION DERIVED FROM PARLIAMENT INTENDED TO CO VER SOURCES NOT BEYOND THE FIRST DEGREE. SECTIONS 80-I, 80-IA AND 80-IB PROVIDE FOR INCENTIV ES IN THE FORM OF DEDUCTIONS WHICH ARE LINKED TO PROFITS AND NOT INVESTMENT. ON ANALYSIS OF SECTIONS 880-IA AND 80- IB IT BECOMES CLEAR THAT ANY INDUSTRIAL UNDERTAKING WHICH BECOMES ELIGIBLE ON SATISFYING SUB-SECTION (2) WOULD BE ENT ITLED TO DEDUCTION UNDER SUB-SECTION (1) ONLY TO THE EXTENT OF PROFITS DERIVED FROM SUCH INDUSTRIAL UNDERTAKING AFTER THE SPECIFIED DATE. APART FROM ELIGIBILITY, SUB-SECTION (1) PURP ORTS TO RESTRICT THE QUANTUM OF DEDUCTION TO A SPECIFIED PE RCENTAGE OF THE PROFITS. THIS IS THE IMPORTANCE OF THE WORDS DERIVED FROM AN INDUSTRIAL UNDERTAKING AS AGAINST PROFITS ATTR IBUTABLE TO AN INDUSTRIAL UNDERTAKING. 53. THE HON'BLE APEX COURT FURTHER OBSERVED AS UND ER: THE WORD DERIVED FROM ARE NARROWER IN CONNOTATIO N AS COMPARED TO THE WORDS ATTRIBUTABLE TO. IN OTH ER WORDS, BY USING THE EXPRESSION DERIVED FROM, PARLIAMENT INTENDED TO COVER SOURCES NOT BEYOND THE FIRST DEGREE. ON AN ANALYSIS OF SECTIONS 80-IA AND 80-IB IT BECOM ES CLEAR THAT ANY INDUSTRIAL UNDERTAKING, WHICH BECOME S ELIGIBLE ON SATISFYING SUB-SECTION (2) WOULD BE ENTITLED TO DEDUCTION UNDER SUB-SECTION (1) ONLY TO THE EXTENT OF PROFITS DERIVED FROM SUCH INDUSTRIAL UNDERTAKING AFTER SPECIFIED DATE(S) . HENCE, APART FROM ELIGIBILITY, SUB-SECTION (1) PURPORTS TO RESTRICT THE QUANTUM OF DEDUCTION TO A SPECIFIED PERCENTAGE OF P ROFITS. THIS IS THE IMPORTANCE OF THE WORDS DERIVED FROM I NDUSTRIAL UNDERTAKING AS AGAINST PROFITS ATTRIBUTABLE TO IN DUSTRIAL UNDERTAKING. 54. THE APEX HON'BLE COURT THUS HELD AS UNDER : DEPB IS AN INCENTIVE. IT IS GIVEN UNDER THE 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. UND ER DEPB, AN EXPORTER MAY APPLY FOR CREDIT AS A PERCENTAGE OF THE FOB VALUE OF EXPORTS MADE IN FREELY CONVERTIBLE CURRENC Y. CREDIT IS AVAILABLE ONLY AGAINST THE EXPORT PRODUCT AND AT RATES SPECIFIED BY THE DGFT FOR IMPORT OF RAW MATERIALS, COMPONENTS, ETC., DEPB CREDIT UNDER THE SCHEME HAS TO BE CALCULATED BY TAKING INTO ACCOUNT THE DEEMED IMPORT CONTENT OF THE EXPORT PRODUCT AS PER BASIC CUSTOMS DUTY AND SP ECIAL ADDITIONAL DUTY PAYABLE ON SUCH DEEMED IMPORTS. TH EREFORE, IN OUR VIEW, DEPB/DUTY DRAWBACK ARE INCENTIVES WHIC H FLOW FROM THE SCHEMES FRAMED BY CENTRAL GOVERNMENT OR FR OM SECTION 75 OF THE CUSTOMS ACT, 1962, HENCE, INCENTI VES PROFITS ARE NOT PROFITS DERIVED FROM THE ELIGIBLE BUSINESS UNDER 6 SECTION 80-IB. THEY BELONG TO THE CATEGORY OF ANCI LLARY PROFITS OF SUCH UNDERTAKINGS. 55. IN VIEW OF THE RATIO LAID DOWN BY THE HON'BLE S UPREME COURT IN LIBERTY INDIA VS. CIT (SUPRA) THE ISSUE TO BE CONSIDERED IS WHETHER THE INCENTIVES RECEIPTS UNDER THE VISHESH KRISHI UPAJ YOJNA ARE THE RECEIPTS ON FIR ST DEGREE AND ENTITLED TO THE CLAIM OF DEDUCTION UNDER SECTIO N 10B OF THE ACT. WHILE DENYING THE BENEFIT OF DEDUCTION U/SS 8 0I/80IA AND 80IB OF THE ACT ON DEPB RECEIPTS, IT WAS OBSERVED B Y THE HON'BLE SUPREME COURT IN LIBERTY INDIA VS. CIT(SUPR A) THAT THE OBJECT BEHIND DEPB IS TO NEUTRALIZE THE INCIDEN CE OF CUSTOMS DUTY PAYMENT ON THE IMPORT CONTENT OF EXP ORT PRODUCT, WHICH WAS PROVIDED FOR BY WAY OF CREDIT TO CUSTOMS DUTY AGAINST EXPORT PRODUCT. THE EXPORTER WAS ENTI TLED TO APPLY FOR CREDIT AS A PERCENTAGE OF THE FOB VALUE O F EXPORT UNDER THE INCENTIVE SCHEME OF GRANT OF DEPB. THE S AID CREDIT WAS AVAILABLE AT RATES SPECIFIED BY THE DGFT FOR IM PORT OF RAW MATERIAL/COMPONENTS ETC. THE HON'BLE SUPREME C OURT FURTHER HELD THAT DEPB/DUTY DRAWBACK WERE INCENTIVE S WHICH FLOW FROM THE SCHEMES FRAMED BY CENTRAL GOVERNMENT. 56. IN THE PRESENT CASE BEFORE US THE COPY OF THE S CHEME OF VISHESH KRISHI UPAJ YOJNA IS PLACED AT PAGES 20 A ND 21 OF THE PAPER BOOK. THE OBJECTIVE OF THE SAID SCHEME W AS TO PROMOTE THE EXPORTS OF AGRICULTURAL PRODUCE AND THE IR VALUE ADDED PRODUCTS, MINOR FOREST PRODUCE, GRAM UDYOG PR ODUCTS, FOREST BASED PRODUCTS AND OTHER PRODUCTS WHICH MAY BE NOTIFIED FROM TIME TO TIME. THE ENTITLEMENT TO THE SCHEME AS PER CLAUSE 3.13.2 IS AS UNDER: 3.13.2 DUTY CREDIT SCRIP BENEFITS AS GRANTED WITH AN AIM TO COMPENSATE HIGH TRANSPORT COSTS AND TO OFFSET OTHER DISADVANTAGES. EXPORTERS OF PRODUCTS NOTIFIED IN APPENDIX 37A OF HBPVL, SHALL BE ENTITLED FOR DUTY CREDIT SCRIP EQUIVALENT TO 5% OF FOB VALUE OF EXPORTS (IN FREE FOREIGN EXCHANGE) FOR EXPORTS MADE FROM 27.8.2009 ONWARDS. 57. UNDER CLAUSE 3.13.3 IT IS PROVIDED THAT DUTY CR EDIT SCRIP BENEFITS UNDER THE SCHEME WOULD BE GRANTED ONLY AT THE REDUCED RATE OF 3% OF FOB VALUE OF EXPORTS IN CASES WHERE EXPORTER HAS AVAILED THE BENEFIT OF: (I) DRAWBACK AT RATES HIGHER THAN 1% AND/OR (II) SPECIFIC DEPB RATE (I.E. OTHER THAN MISCELLANEOUS CATEGORY SR.NOS.22C & 22D OF PRODUCT GROUP 90%); AND/OR (III) ADVANCE AUTHORIZATION OR DUTY FREE IMPORT AUTHORIZATION IMPORT OF INPUTS (OTHER THAN CATALYST, CONSUMABLE AND 7 PACKING MATERIALS)FOR THE EXPORTED PRODUCT FOR WHICH DUTY CREDIT SCRIP UNDER VKGUY IS BEING CLAIMED. 58. FURTHER BENEFITS ARE ALSO GIVEN UNDER THE SCHEM E, BUT THE RELEVANT BENEFITS OF THE SCHEME VIS--VIS ASSES SEE ARE AS REFERRED TO BY US IN THE ABOVE PARA. IN VIEW OF TH E SCHEME UNDER WHICH THE ASSESSEE IS ENTITLED TO THE INCENTI VES WHICH IN TURN ARE TO COMPENSATE HIGH TRANSPORT COST AND TO O FFSET OTHER ADVANTAGES TO THE EXPORTERS, AND ALSO IN VIEW OF TH E FACT THAT THE INCENTIVES ARE TO BE ALLOWED AT REDUCED RATES W HERE THE ASSESSEE IS IN RECEIPT OF DUTY DRAWBACK, DEPB, WE A RE OF THE VIEW THAT THE INCENTIVES RECEIVED BY THE ASSESSEE U NDER THE VISHESH KRISHI UPAJ YOJNA AS AN EXPORT INCENTIVE WERE GIVEN TO THE ASSESSEE TO NEUTRALIZE THE INCIDENCE OF HIGH TRANSPORT COST AND ALSO TO OFFSET OTHER DISADVANTAGES. THE S AID NEUTRALIZATION AS IN THE CASE OF HON'BLE SUPREME CO URT IN THE CASE LIBERTY INDIA VS. CIT (SUPRA) IS LINKED TO THE FOB VALUE OF EXPORTS BY WAY OF DUTY CREDIT SCRIP. THE SAID B ENEFITS ARE PROVIDED BY DGFT IN THE CASE OF THE ASSESSEE AND TH E SAID SCHEME BEING SIMILAR TO THE SCHEME OF GRANT OF DUTY DRAWBACK/DEPB AND IN TURN APPLYING THE RATIO LAID D OWN BY THE HON'BLE SUPREME COURT IN THE CASE OF LIBERTY IN DIA VS. CIT (SUPRA) WE HOLD THAT THE ASSESSEE IS NOT ENTITL ED TO THE CLAIM OF DEDUCTION UNDER SECTION 10B OF THE ACT ON THE SAID INCENTIVES. IN VIEW THEREOF, WE UPHOLD THE ORDER O F ENHANCEMENT PASSED BY THE COMMISSIONER OF INCOME TA X IN EXERCISE OF ITS JURISDICTION UNDER SECTION 263 OF T HE ACT. THE GROUND NO.5 RAISED BY THE ASSESSEE IS THUS DISMISSE D. 8. THEREAFTER, THE ASSESSEE MOVED A MISCELLANEOUS A PPLICATION AGAINST THE ORDER OF THE TRIBUNAL AND THE TRIBUNAL IN CONSOLIDATED ORDER IN MA NOS. 3 TO 6/CHD/2014 RELATING TO ASSESS MENT YEARS 2006-7 TO 2009-10 VIDE ORDER DATED 19.06.2014 HELD AS UNDE R : 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE IN ITA NO. NO. 553/CHD/2011 HA D RAISED THE ISSUE OF CLAIM OF DEDUCTION UNDER SECTIO N 10B OF THE ACT VIS--VIS THE PROFITS ON SALE OF INCENTIVES RECEIVED UNDER THE SCHEME VISHESH KRISHI UPAJ YOJNA @ 5% OF FOB VALUE OF EXPORTS, RECEIVED FROM MINISTRY OF COMMERC E, GOVT. OF INDIA. THE TRIBUNAL VIDE PARAS 47 TO 59 AT PAGE S 40 TO 48 HAD CONSIDERED THE PLEA OF THE ASSESSEE AND THE SCH EME UNDER WHICH INCENTIVES WERE RECEIVED AND ALSO THE RATIO L AID DOWN BY THE HON'BLE SUPREME COURT IN LIBERTY INDIA V CIT (SUPRA). AFTER HOLDING THAT THE ASSESSEE WAS ENTIT LED TO CLAIM OF DEDUCTION UNDER SECTION 10B OF THE ACT ON ITS PROFITS FROM BUSINESS, THE OTHER ISSUE CONSIDERED BY THE TR IBUNAL WAS WHETHER THE INCENTIVES RECEIVED UNDER VISHESH K RISHI UPAJ YOJNA WERE DERIVED FROM THE UNDERTAKING AND WE RE THUS, ELIGIBLE FOR DEDUCTION UNDER SECTION 10B OF THE ACT . THE TRIBUNAL VIDE PARAS 56 AND 57 CONSIDERED THE SCHEME UNDER 8 WHICH THE ASSESSEE HAD RECEIVED THE INCENTIVES AND IT HAS BEEN HELD THAT THE INCENTIVES RECEIVED BY THE ASSES SEE UNDER THE SAID SCHEME WERE GIVEN TO THE ASSESSEE TO NEUTR ALIZE THE INCIDENCE OF HIGH TRANSPORT COST AND ALSO TO OFFSET OTHER DISADVANTAGE. THE TRIBUNAL FURTHER HELD THAT THE SAID NEUTRALIZATION AS IN THE CASE OF HON'BLE SUPREME CO URT IN THE CASE LIBERTY INDIA VS. CIT (SUPRA) IS LINKED TO THE FOB VALUE OF EXPORTS BY WAY OF DUTY CREDIT SCRIP. THE SAID BE NEFITS ARE PROVIDED BY DGFT IN THE CASE OF THE ASSESSEE AND TH E SAID SCHEME BEING SIMILAR TO THE SCHEME OF GRANT OF DUTY DRAWBACK/DEPB AND IN TURN APPLYING THE RATIO LAID D OWN BY THE HON'BLE SUPREME COURT IN THE CASE OF LIBERTY IN DIA VS. CIT (SUPRA) WE HOLD THAT THE ASSESSEE IS NOT ENTITL ED TO THE CLAIM OF DEDUCTION UNDER SECTION 10B OF THE ACT ON THE SAID INCENTIVES. 6. IN VIEW OF THE SAID FINDINGS, WE FIND NO MERIT I N THE STAND OF THE ASSESSEE THAT THE SPECIAL BENCH OF TRI BUNAL IN MARAL OVERSEAS VS ADDL. CIT (SUPRA) AND MUMBAI BENC H OF TRIBUNAL IN ARTS & CRAFTS EXPORTS V ITO (SUPRA) HAD ALLOWED SIMILAR BENEFIT OF EXEMPTION UNDER SECTION 10B OF T HE ACT IN RESPECT OF EXPORT BENEFITS. THE SAID DECISIONS WER E REFERRED TO BY THE LD. AR FOR THE ASSESSEE DURING THE COURSE OF ARGUING THE APPEAL. HOWEVER, SINCE THE ISSUE WAS SQUARELY COVERED BY THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT AND THE SCHEME BEING SIMILAR AS TO THE SCHEME CONSIDERED BY THE HON'BLE SUPREME COURT IN LIBERTY INDIA V CIT (SUPRA ) AND FURTHER THE SCHEME CONSIDERED BY THE DIFFERENT BENC HES OF TRIBUNAL BEING AT VARIANCE, NO FAULT CAN BE FOUND W ITH THE ORDER OF THE TRIBUNAL AND WE FIND NO MERIT IN THE P RESENT MISCELLANEOUS APPLICATION MOVED BY THE ASSESSEE IN THIS REGARD AND THE SAME IS DISMISSED . 9. THE ISSUE RAISED IN THE PRESENT APPEAL IS IDENTI CAL TO THE ISSUE BEFORE THE TRIBUNAL AND FOLLOWING THE SAME PARITY O F REASONING AS IN M/S LITTLE BEE IMPEX, WE HOLD THAT ASSESSEE IS NOT ENTITLED TO THE DEDUCTION UNDER SECTION 80IC OF THE ACT ON RECEIPTS FROM VISHESH KRISHI UPAJ YOJNA. 10. ANOTHER ISSUE RAISED BY THE ASSESSEE IS WITH RE GARD TO THE CLAIM OF DEDUCTION UNDER SECTION 80IC OF THE ACT ON DUTY DRAW BACK. THE SAID ISSUE IS SQUARELY COVERED BY THE RATIO LAID DO WN BY THE HON'BLE SUPREME COURT IN LIBERTY INDIA LTD. VS CIT (SUPRA) WHEREIN IT IS HELD THAT THE ASSESSEE IS NOT ENTITLED TO ANY DEDUCTION UNDER SECTION 80IC ON DUTY DRAW BACK. THE RECEIPTS BEING SIMILAR AND THE PROVISIONS OF 9 SECTION 80IA AND 80IC BEING PERIMATERIA, WE HOLD TH AT THE ASSESSEE IS NOT ENTITLED TO THE CLAIM OF DEDUCTION UNDER SECTIO N 80IC ON DUTY DRAW BACK. REJECTING THE PLEA OF THE ASSESSEE, WE DISMISS THE GROUND OF APPEAL RAISED BY THE ASSESSEE. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH AUGUST,2014. SD/- SD/- ( T.R.SOOD) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28 TH AUGUST,2014 POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR/ITAT/CHD