DCIT, Madurai V. M/s. Selvaraj Tex, Madurai

ITA 1942/CHNY/2009

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58050 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2012
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 14-03-2012
• Assessment Year: 1999-2000
• Appeal Filed On: 29-12-2009
• Court: TRIBUNAL
• Department Lawyers: E S NAGENDRA PRASAD
• Assessee Lawyers: A S SRIRAMAN
• Section: 80HHC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A. NOS. 1942, 1943 & 1944/MDS/2009 (ASSESSMENT YEARS : 1999-2000, 2000-01 & 2001-02) THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE II, MADURAI. (APPELLANT) V. M/S SELVARAJ TEX, NO.7, AHIMSAPURAM 4 TH STREET, SELLUR, MADURAI 2. PAN : AADFS8601A (RESPONDENT) APPELLANT BY : SHRI E.S. NAGENDRA PRASAD RESPONDENT BY : SHRI A.S. SRIRAMAN DATE OF HEARING : 14.03.2012 DATE OF PRONOUNCEMENT : 14.03.2012 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : ALL THE THREE APPEALS ARE FILED BY THE REVENUE AN D THE ISSUE RAISED IS ONE AND THE SAME. AS PER THE REVENUE, TH E CIT(APPEALS) ALLOWED INCREASE OF 90% OF FACE VALUE OF DEPB TO TH E PROFIT OF THE EXPORT BUSINESS OF THE ASSESSEE FOR CALCULATION OF DEDUCTION UNDER SECTION 80HHC OF INCOME-TAX ACT, 1962 (IN SHORT 'TH E ACT') AND ALSO I.T.A. NOS. 1942, 1943 & 1944/MDS/09 2 DIRECTED THE INCLUSION OF ENTIRE SALE PROCEEDS IN D EPB IN TOTAL TURNOVER. AS PER THE REVENUE, LD. CIT(APPEALS) FEL L IN ERROR IN GIVING SUCH DIRECTION SINCE ASSESSEE FELL WITHIN THE THIRD PROVISO TO SUB- SECTION (3) OF SECTION 80HHC OF THE ACT, ITS TURNOV ER HAVING EXCEEDED ` 10 CRORES. 2. WHEN THE MATTER CAME UP, LEARNED D.R. SUBMITTED THAT NEITHER LD. CIT(APPEALS) NOR THE A.O. HAD THE BENEFIT OF WI SDOM OF HONBLE APEX COURT IN THE CASE OF TOPMAN EXPORTS V. CIT (CI VIL APPEAL NO.1699 OF 2012 DATED 8 TH FEBRUARY, 2012) WHEN THEY WERE DECIDING THE ISSUE REGARDING TREATMENT OF DEPB FOR THE PURPO SE OF CALCULATING DEDUCTION AVAILABLE TO THE ASSESSEE UNDER SECTION 8 0HHC OF THE ACT. 3. LEARNED A.R. DID NOT RAISE ANY SERIOUS OBJECTION IN REMITTING BACK THE MATTER TO A.O. FOR CONSIDERATION AFRESH. 4. WE HAVE PERUSED THE ORDERS AND HEARD THE SUBMIS SIONS. AS IT IS CLEAR FROM THE GROUND ITSELF, THE ISSUE IS REGAR DING TREATMENT OF DEPB FOR CALCULATING DEDUCTION UNDER SECTION 80HHC OF THE ACT, LD. CIT(APPEALS) RELIED ON THE DECISION OF SPECIAL BENC H OF THIS TRIBUNAL IN THE CASE OF TOPMAN EXPORTS V. ITO (124 ITD 1) W HILE DECIDING THE ISSUE IN FAVOUR OF ASSESSEE. NO DOUBT, THE DECISIO N OF SPECIAL BENCH I.T.A. NOS. 1942, 1943 & 1944/MDS/09 3 OF THIS TRIBUNAL WAS REVERSED BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V. KALPATARU COLOURS & CHEMICALS (3 28 ITR 451), BUT, HONBLE APEX COURT IN THE CASE OF TOPMAN EXPORTS (S UPRA) HAS OVERTURNED THE DECISION OF HONBLE BOMBAY HIGH COUR T AND CONFIRMED THE ORDER OF SPECIAL BENCH OF THIS TRIBUNAL IN THE CASE OF TOPMAN EXPORTS (SUPRA). NEVERTHELESS, IN VIEW OF THE INT ERVENING CONFUSION IN THE MATTER DUE TO VARIOUS DECISIONS AND ALSO OTH ER DECISIONS AVAILABLE REGARDING APPLICATION OF THIRD PROVISO TO SUB-SECTION (3) OF SECTION 80HHC OF THE ACT WHERE TURNOVER EXCEEDED ` 10 CRORES, WE ARE OF THE OPINION THAT THE MATTER REQUIRES FRESH L OOK BY THE ASSESSING OFFICER. WE, THEREFORE, SET ASIDE THE ORDERS OF TH E AUTHORITIES BELOW AND REMIT THE ISSUE REGARDING CONSIDERATION OF DEPB FOR THE PURPOSE OF CALCULATING DEDUCTION UNDER SECTION 80HHC OF THE ACT, BACK TO THE FILE OF A.O. FOR CONSIDERATION DE NOVO FOR ALL THE YEARS, IN ACCORDANCE WITH LAW. 5. IN THE RESULT, ALL THE THREE APPEALS FILED BY TH E REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. I.T.A. NOS. 1942, 1943 & 1944/MDS/09 4 ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSION OF HEARING ON 14 TH MARCH, 2012. SD/- SD/- (VIKAS AWASTHY) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 14 TH MARCH, 2012. KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A)-I, MADURAI (4) CIT-I, MADURAI (5) D.R. (6) GUARD FILE