COMM. OF INCOME TAX, KARNAL vs. M/S SPARTAN TRENDS INC. PANIPAT

ITA/522/2010HC Punjab & HaryanaPHHC01093465201031 January 2011Author: MR. JUSTICE AJAY KUMAR MITTAL,MR. JUSTICE ADARSH KUMAR GOEL2 pages
AI SummaryRemanded

What were the facts?

The Commissioner of Income-Tax, Karnal (the revenue) filed an appeal under Section 260-A of the Income Tax Act, 1961, against the order dated 4.12.2009 of the Income Tax Appellate Tribunal (ITAT), Delhi Bench 'I'. The appeal pertains to assessment year 2004-05 and concerns the assessee, M/s Spartan Trends Inc. The ITAT's order allowed deduction under Section 80HHC. The revenue is challenging the ITAT's decision regarding the allowance of deduction on the face value of DEPB and the incorporation of the entire DEPB amount in the computation of business profit.

What did the High Court hold?

The High Court noted that the revenue's counsel stated the matter was covered by earlier orders of the High Court dated 16.8.2010 in I.T.A. No.301 of 2010 (CIT v. M/s Victor Forgings) and I.T.A. No.299 of 2010 (CIT v. F.C. Sondhi). In those cases, after noticing the judgment of the Bombay High Court in CIT v. Kalpataru Colours & Chemicals, the matter was remanded to the Tribunal for a fresh decision in accordance with law. Consequently, the High Court disposed of the present appeals in the same terms, remanding the matter to the ITAT for a fresh decision. The Court did not consider it necessary to issue notice to the respondent but granted liberty to the respondent to move the Court if they had any grievance.

What were the issues?

1. Whether on the facts and circumstances of the case, the Hon'ble ITAT was justified in allowing deduction u/s 80HHC on the face value of DEPB where turnover exceeds Rs.10 crores, in view of the proviso (ii), (iii) and (iv) inserted by the Taxation Law (Amendment) Act, 2005 with retrospective effect from 01.4.1998? 2. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT was justified in allowing deduction u/s 80HHC in respect of the entire DEPB amount by incorporating the same in the computation of business profit u/s 28(iib)? Assessee's contentions: Not recorded in the judgment. Revenue's contentions: The revenue argued that the matter is covered by the High Court's earlier orders in CIT v. M/s Victor Forgings and CIT v. F.C. Sondhi, which followed the Bombay High Court's decision in CIT v. Kalpataru Colours & Chemicals. These orders remanded the matter to the Tribunal for fresh decision.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 80HHC,Section 28(iib)

AI-generated summary — verify with the full judgment below

Income-tax Appeal No.522

of 2010

-1- **** IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Income-tax Appeal No.522

of 2010

Date of decision: 31.1.2011 The Commissioner of Income-Tax, Karnal ...Appellant Versus M/s Spartan Trends Inc. ...Respondent CORAM: HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MR.JUSTICE AJAY KUMAR MITTAL Present: Mr. Yogesh Putney, Advocate for the appellant.

**** ADARSH KUMAR GOEL, J (

Oral)

.

1.

This order will dispose of ITAs No.522 of 2010 and 678 of 2010 as it is stated that questions involved in both the appeals are same.

2.

ITA No.522 of 2010 has been preferred by the revenue under Section 260-A of the Income Tax Act, 1961 against the order dated 4.12.2009 of the Income Tax Appellate Tribunal, Delhi Bench 'I', New Delhi in I.T.A. No.1710/Del/2007 for the assessment year 2004-05 proposing to raise following substantial questions of law:- (i) Whether on the facts and circumstances of the case, the Hon'ble ITAT was justified in allowing deduction u/s 80 HHC on the face value of DEPB in the case where turnover exceeds Rs.10 crores in view of proviso (ii), (iii) and (iv) inserted by the taxa

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 260-A

All 2,347 judgments and leading authorities on Section 260-A →

Recent GST High Court judgments

Search GST case law →