ACIT, New Delhi V. Purolator India Ltd., New Delhi

ITA 2112/DEL/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3596 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-07-2010
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: F
• Next Hearing Date: 07-07-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 06-05-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: H K LAL
• Assessee Lawyers: MADH AVI SWARUP
• Keywords: Opportunity of being heard
• Section: 80HHC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `F : NEW DELHI BEFORE SHRI C.L. SETHI, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER I.T.A.NO.2112/DEL/2010 ASSESSMENT YEAR : 2004-05 ASSTT. COMMISSIONER OF INCOME-TAX, PUROLATOR INDIA LTD., CIRCLE 14(1), NEW DELHI. VS. 1-AUROBINDO MARG, NEW DELHI. PAN: AACP5890Q (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI H.K. LAL, SR. DR. RESPONDENT BY : MS. MADH AVI SWARUP, ADVOCATE. O R D E R PER C.L. SETHI, JUDICIAL MEMBER. IN THIS APPEAL FILED BY THE REVENUE AGAINST THE ORD ER DATED 26.02.2010 PASSED BY THE LEARNED COMMISSIONER OF INCOME-TAX (A PPEALS) FOR THE ASSESSMENT YEAR 2004-05, THE REVENUE HAS TAKEN THE FOLLOWING TWO GROUNDS:- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN DIRECTING THE AO TO RECOMPU TE THE DEDUCTION UNDER SECTION 80-HHC OF THE IT ACT, 1961 AFTER INCLUDING THE DEPB RECEIPTS OF RS.1,28,39,470/-. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CAS E AND IN LAW THE LD. CIT(A) ERRED IN DIRECTING THE AO TO RECOMPU TE THE DEDUCTION ON THE BASIS OF THE DECISION OF HONBLE D ELHI HIGH 2 COURT IN THE CASE OF CIT VS. SHRI RAM HONDA POWER E QUIPMENT (2007) 289 ITR 475. 2. WE HAVE HEARD BOTH THE PARTIES AND HAVE CAREFULL Y PERUSED THE ORDERS OF THE AUTHORITIES BELOW. 3. THE DEPB RECEIPTS HAVE BEEN EXCLUDED FOR THE PUR POSE OF COMPUTING DEDUCTION UNDER SECTION 80HHC OF THE ACT, BY THE AS SESSING OFFICER. HOWEVER, THE LEARNED CIT(A) DIRECTED THE AO TO RECO MPUTE THE DEDUCTION UNDER SECTION 80HHC IN THE LIGHT OF THE DECISION OF SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF TOPMAN EXPORTS VS. ITO (ITA NO.5769/MUM/06) AND KALPATARU COLOURS AND CHEMICALS VS. ACIT (ITA N O.5651/MUM/06). 4. AFTER HEARING BOTH THE PARTIES, WE FIND THAT THE CIT(A) IS JUSTIFIED IN RESTORING THE MATTER TO THE FILE OF THE AO TO RECOM PUTE THE DEDUCTION UNDER SECTION 80HHC OF THE ACT. HOWEVER, WHILE RECOMPUTI NG THE DEDUCTION U/S 80HHC, THE AO SHALL TAKE INTO ACCOUNT THE LATEST DE CISION OF HONBLE HIGH COURT ARISING FROM THE DECISION OF SPECIAL BENCH IN THE CASE OF TOPMAN EXPORTS VS. ITO. IN OTHER WORDS, THE DECISION IN T HE CASE OF TOPMAN EXPORTS SHALL BE APPLIED BY THE AO AS IT IS MODIFIED BY THE HIGH COURT. THE AO SHALL PROVIDE REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. WITH REGARD TO THE RE-COMPUTATION OF DEDUCTION U /S 80HHC WITH REFERENCE TO THE INTEREST EXPENSES, WE FIND THAT TH E CIT(A) HAS RIGHTLY DECIDED THIS ISSUE BY DIRECTING THE AO TO VERIFY TH E NATURE OF INTEREST INCOME 3 AND THEN TO RE-COMPUTE THE DEDUCTION IN THE LIGHT O F THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. SHRI RAM HO NDA POWER EQUIPMENT (2007) 289 ITR 475. WE DO NOT FIND ANY INFIRMITY I N THE ORDER OF THE CIT(A) ON THIS ASPECT OF THE MATTER. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S PARTLY ALLOWED FOR STATISTICAL PURPOSES IN THE MANNER INDICATED ABOVE. 7. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT O N 7 TH JULY, 2010 IMMEDIATELY AFTER HEARING WAS OVER. SD/- SD/- (A.K. GARODIA) (C.L. SETHI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 7 TH JULY, 2010. COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR, ITAT.