Ultimate Fashion Maker Ltd, V. ITO Ward- 18 (1),

ITA 1685/DEL/2008

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 9928 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Next Hearing Date: 08-09-2009
• Assessment Year: 1999-2000
• Appeal Filed On: 02-05-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: G S SAHOTA
• Assessee Lawyers: R K MEHRA
• Keywords: Set aside
• Section: 80HHC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH `H : NEW DELHI) BEFORE SHRI A.D. JAIN, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.1685/DEL./2008 (ASSESSMENT YEAR : 1999-2000) M/S ULTIMATE FASHION MAKER LTD., VS. ITO, WARD 18( 1), B-286, OKHLA INDUSTRIAL AREA, PHASE I, NEW DELHI. NEW DELHI. (PAN/GIR NO.AAACU2186Q) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI R.K. MEHRA, REVENUE BY : SHRI G.S. SAHOTA, SR.DR ORDER PER A.K. GARODIA: AM THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE O RDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-XXI, NEW DELHI, DATED 14.2.200 8 FOR ASSESSMENT YEAR 1999-2000. 2. GROUND NOS.1& 2 WERE NOT PRESSED BY THE LD.AR OF THE ASSESSEE AND, HENCE THE SAME ARE REJECTED AS NOT PRESSED. 3. GROUND NOS.3 & 4 ARE INTER-CONNECTED WHICH READ AS UNDER: 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E PETITIONER COMPANYS CASE, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS), E RRED IN LAW IN NOT ALLOWING APPROPRIATE AMOUNT OF DEDUCTION UNDER SECT ION 80HHC OF THE INCOME-TAX ACT, 1961, WHICH WAS REQUIRED TO BE COMP UTED IN VIEW OF THE AMENDMENTS IN THE RELEVANT PROVISIONS OF SECTION 80 HHC MADE BY THE TAXATION LAWS (AMENDMENT) ACT, 2005 NO.55 OF 2005. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E PETITIONERS CASE, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS), ERRED IN LAW IN NOT DIRECTING THE LEARNED ASSESSING OFFICER TO COMPUTE DEDUCTION UNDE R SECTION 80HHC OF THE ACT, BY TAKING INTO ACCOUNT ONLY THE PROFITS ARISING ON TRANSFER OF DEPB IN TERMS OF SECTION (28IIID) OF THE ACT AND UPHOLDING THE ACTI ON OF THE ASSESSING OFFICER IN CONSIDERING THE ENTIRE SALE PROCEEDS OF DEPB OF RS. 5101539 AS PROFITS, THUS NEGATING THE MANDATE PROVIDED IN SECTION 28(IIID) O F THE ACT. THE LEARNED CIT(A) FURTHER ERRED IN LAW IN IGNORING THE EFFECT THAT THE VALUE OF DEPB IS ACTUALLY THE BENEFIT ARISING TO THE PETITIONER COMP ANY ON ACCOUNT OF REIMBURSEMENT OF CUSTOM DUTY SUFFERED BY IT AS EXPO RTER, WHICH IS REFUNDED BACK TO HIM AS PER THE SCHEME OF THE CENTRAL GOVER NMENT. I.T.A. NO.1685/DEL./2008 (A.Y. : 1999-2000) 2 4. IT WAS SUBMITTED BY THE LD.AR OF THE ASSESSEE TH AT THIS ISSUE IS NOW COVERED IN FAVUOR OF THE ASSESSEE BY THE DECISION OF THE MUMBA I SPECIAL BENCH OF THE TRIBUNAL, RENDERED IN THE CASE OF TOPMAN EXPORTS VS. ITO. I T WAS SUBMITTED THAT THIS ISSUE MAY BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER FOR A FRESH DECISION IN THE LIGHT OF THIS DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL. LD. DR OF THE REVENUE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND THE DECISION OF THE SPECIAL BENCH OF TRIBUNAL CITED BY THE LD.AR OF THE ASSESSEE. THIS DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL HAS C OME AFTER PASSING OF ORDER BY COMMISSIONER OF INCOME-TAX (APPEALS) AND HENCE WE FEEL THAT THIS MATTER SHOULD GO BACK TO THE FILE OF ASSESSING OFFICER FOR A FRESH D ECISION IN THE LIGHT OF THIS DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL CITED ABOVE. ACCORDI NGLY, WE SET ASIDE THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) ON THIS ISSUE AND RESTORE THIS MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR A FRESH DECISION REGARDING ALLOWABILITY OF DEDUCTION TO THE ASSESSEE U/S 80HHC OF THE ACT IN THE LIGHT OF T HIS DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL RENDERED IN THE CASE CITED ABOVE. THE ASS ESSING OFFICER SHOULD PASS NECESSARY ORDER AS PER LAW AFTER PROVIDING ADEQUATE OPPORTUNI TY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED FOR STATISTICAL PURPOSE. 7. ORDER PRONOUNCED IN OPEN COURT ON 8.9.2009 AT TH E CONCLUSION OF THE HEARING OF THE APPEAL. (A.D. JAIN) (A.K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: SEPT. 08, 2009. *SKB* COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A)-XXI, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DELHI. AR/ITAT I.T.A. NO.1685/DEL./2008 (A.Y. : 1999-2000) 3