COMMISSIONER OF INCOME TAX, KARNAL vs. M/S GUPTA TEXTILES, PANIPAT

ITA/521/2010HC Punjab & HaryanaPHHC01093464201025 November 2010Author: MR. JUSTICE ADARSH KUMAR GOEL,MR. JUSTICE AJAY KUMAR MITTAL2 pages
AI SummaryRemanded

What were the facts?

The revenue, the Commissioner of Income Tax, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order of the Income Tax Appellate Tribunal (ITAT), Delhi Bench 'C'. The appeal pertains to the assessment year 2004-05 and challenges the ITAT's decision regarding the allowability of deduction under Section 80HHC. The dispute involves the treatment of Duty Exemption Pass Book (DEPB) benefits. The High Court noted that an identical appeal filed by the revenue (ITA No. 299 of 2010) had been allowed and remanded by the same Court on August 16, 2010. Consequently, the present appeal was disposed of in similar terms.

What did the High Court hold?

The High Court disposed of the appeal in terms of its earlier decision in ITA No. 299 of 2010 (Commissioner of Income-tax v. M/s F.C. Sondhi & Company (P) Ltd.), which was allowed and remanded on August 16, 2010. Consequently, the present appeal was also remanded to the ITAT. The Tribunal was directed to take up the matter on December 20, 2010, along with connected matters, and proceed in accordance with law after due notice to the assessee. The judgment did not provide specific findings on the substantial questions of law raised, as it relied on a prior order for remand. The ratio decidendi is that if an identical issue has been remanded by the High Court, the current appeal on the same issue should also be remanded to the Tribunal for fresh adjudication.

What were the issues?

The High Court was asked to decide the following substantial questions of law: 1. Whether the ITAT was justified in allowing deduction under Section 80HHC on the face value of DEPB when the turnover exceeded Rs. 10 crores, considering the retrospective insertion of provisos (ii), (iii), and (iv) by the Taxation Law (Amendment) Act, 2005, effective from April 1, 1998? 2. Whether the ITAT was justified in allowing deduction under Section 80HHC in respect of the entire DEPB amount by incorporating it into the computation of business profit under Section 28(iiib)? Contentions: Revenue: The revenue's counsel pointed out that an identical appeal filed by the revenue (Commissioner of Income-tax v. M/s F.C. Sondhi & Company (P) Ltd.) was allowed and remanded by the High Court on August 16, 2010. No specific arguments were recorded for the revenue in relation to the merits of the questions of law in this judgment, other than referencing the prior decision. Assessee: No specific arguments were recorded for the assessee in this judgment.

Which sections of the Income-tax Act were involved?

Section 260A,Section 80HHC,Section 28(iiib)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of Decision: 25.11.2010 The Commissioner of Income Tax ....Appellant Versus M/s Gupta Textiles ...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.

1.

This appeal has been filed by the revenue under Section 260A of the Income Tax Act, 1961 against order of the Income Tax Appellate Tribunal, Delhi Bench 'C', New Delhi passed in ITA No. 1990/Del/08 dated 6.11.2009 for the assessment year 2004-05, proposing to raise following substantial questions of law:- “i) Whether on the facts and in the circumstances of the case, the Hon'ble ITAT was justified in allowing deduction u/s 80HHC 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 Taxation Law (Amendment) Act, 2005 with retrospective effect from 01.04.1998?

-2- ii) 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 entire DEPB amount by incorporating t

The order continues below.

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