ACIT, New Delhi V. M/s Leather Tech, New Delhi

ITA 4784/DEL/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 8143 (ITAT-DELHI)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 18-02-2010
• Assessment Year: 2001-2002
• Appeal Filed On: 18-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANOOP KUMA R SINGH
• Assessee Lawyers: SANTOSH KUMAR AGGARWAL
• Section: 80HHC; 28

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D: NEW DELHI BEFORE SHRI C.L. SETHI, JUDICIAL MEMBER & SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO. 4784/DEL/2009 ASSESSMENT YEAR: 2001-02 ASST. COMMISSIONER OF INCOME TAX RANGE 22(1), NEW DELHI VS. LEATHER TECH D-43, OKHLA INDL. AREA, PHASE II, NEW DELHI (APPELLANT) (RESPONDENT) PAN : AAAFL 1041 J APPELLANT BY : SHRI ANOOP KUMA R SINGH, SR. DR RESPONDENT BY : SHRI SANTOSH KUMAR AGGARWAL, AD V. O R D E R PER: C.L. SETHI, J.M. THE REVENUE IS IN APPEAL AGAINST THE ORDER DATED 14.10.2009 PASSED BY THE LD. CIT(A) FOR THE A.Y. 2001-02. 2. THE GROUNDS OF APPEAL RAISED BY THE REVENUE ARE AS UNDER:- 1. ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN LAW AND ON THE FAC TS IN DIRECTING THE AO TO RECOMPUTED THE DEDUCTION U/S. 80HHC OF THE ACT ON THE SALE PROCEEDS RECEIVED ON DEPB. 2. ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN LAW AND ON THE FAC TS IN WRONGLY PRESUMING THE FACT THAT THE ASSESSEE HAS F ULFILLED BOTH THE CONDITIONS AS LAID DOWN IN THE THIRD PROVI SO UNDER SECTION 80HHC (3) OF THE ACT. ITA NO. 4784/DEL/2009 PAGE 2 OF 3 3. ON PERUSAL OF THE GROUNDS, WE FIND THAT THE ISSU E INVOLVED IS ABOUT THE COMPUTATION OF DEDUCTION U/S. 80 HHC ON THE SAL E PROCEEDS RECEIVED ON DEPB. 4. THIS ISSUES HAVE BEEN DECIDED BY THE CIT(A) BY O BSERVING AS UNDER:- 7. FROM THE ABOVE, IT WOULD BE CLEAR THAT ONLY THE PROFIT ELEMENT ON THE SALE OF DEPB, I.E. AMOUNT IN EXCESS OF SALE PROCEEDS OVER THE FACE VALUE IS COVE RED UNDER SECTION 28(IIID). THE HONBLE TRIBUNAL HAS A LSO HELD THAT THE ENTIRE AMOUNT RECEIVED ON SALE OF DEP B ENTITLEMENT WOULD NOT REPRESENT THE PROFIT CHARGEAB LE UNDER SECTION 28 (IIID). THE DECISION OF THE HONB LE TRIBUNAL IS BINDING ON ME, BEING A HIGHER JUDICIAL FORUM [SEE: NOKIA CORPORATION V. DIT (INTERNATIONAL TAXAT ION) (2007) 292 ITR 22 (DELHI)]. THUS, THE ASSESSING OF FICER IS DIRECTED TO RE-COMPUTE THE DEDUCTION UNDER SECTI ON 80 HHC, IN ACCORDANCE WITH THE DECISION OF THE SPECIAL BENCH OF THE MUMBAI TRIBUNAL, AS CITED ABOVE. THE ASSESSEE SUCCEEDS IN GROUND OF APPEAL NO. 4 TO 9. 5. AFTER HEARING BOTH THE PARTIES, WE DO NOT FIND A NY INFIRMITY IN THE ORDER OF THE CIT(A) IN DIRECTING THE AO TO RE-COMPU TE THE DEDUCTION U/S. 80HHC IN ACCORDANCE WITH THE DECISION OF SPECIAL BE NCH OF ITAT, MUMBAI BENCH, IN THE CASE OF TOPMAN EXPORTS VS. I.T.O. REPORTED IN (2009) 125 TTJ (MUMBAI)(SB) 289 . HOWEVER, THE AO SHALL BE AT LIBERTY TO DECIDE THE ISSUE IN THE LIGHT OF THE DECISION OF SPECIAL BENCH, REFERRED TO ABOVE OR TO APPLY ANY OTHER SUBSEQUENT DECISION THAT MAY BE RENDERED ITA NO. 4784/DEL/2009 PAGE 3 OF 3 IN THE MEANTIME, THE AO SHALL PROVIDE REASONABLE OP PORTUNITY OF BEING HEARD TO THE ASSESSEE. WE ORDER ACCORDINGLY. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED WITH ABOVE OBSERVATION. 7. THIS DECISION IS PRONOUNCED IN THE OPEN COURT ON 18 TH FEBRUARY, 2010. SD/- (SHAMIM YAHYA) ACCOUNTANT MEMBER SD/- (C.L. SETHI) JUDICIAL MEMBER DATED: 18 TH FEBRUARY, 2010 *NITASHA COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, NEW DELHI. BY ORDER DEPUTY REGISTRAR