THE COMMR.OF INCOME TAX,TRIVANDRUM vs. SHRI.A.M.MOOSA,CHANDIROOR,ALLEPPEY

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ITR/1/2004HC KeralaKLHC01022406200425 November 2008Bench: HONOURABLE MR.JUSTICE HARUN-UL-RASHID,HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR4 pages
AI SummaryPartly Allowed

What did the High Court hold?

The High Court disposed of the reference by answering the question substantially in favor of the assessee and partly in favor of the revenue. The court found that out of eight items mentioned in paragraph 2 of the reference order, disallowance was warranted only for ice sales amounting to Rs. 45,507/-, freezing and cold storage charges of Rs. 1,04,482/-, profit on sale of vehicles of Rs. 19,656/-, and interest on investments of a paltry sum of Rs. 537/-. All other items were held to qualify for consideration in the computation of eligible export profits. The ITAT's order was to be modified consistent with this decision.

What were the facts?

This is a Tax Reference filed by the Commissioner of Income Tax, Trivandrum, against an order of the Income Tax Appellate Tribunal (ITAT), Cochin Bench. The reference concerns the assessment year(s) not explicitly stated but implied to be prior to the ITAT order in ITA No. 801/COCH/1992. The dispute revolves around whether certain items of income should be included in the computation of eligible exemption of export profit under Section 80HHC of the Income Tax Act. The revenue is the applicant, and Shri A.M. Moosa is the respondent assessee.

What were the issues?

1. Whether certain items of income, specifically those enumerated in paragraph 2 of the reference order, should be reckoned while computing eligible exemption of export profit under Section 80HHC of the Income Tax Act. Assessee's Contention: The assessee, through their counsel, implicitly argued that the items in question should be considered for the eligible exemption of export profit. The judgment indicates that most items were considered in favor of the assessee. Revenue's Contention: The revenue, through its senior counsel, sought to exclude specific items from the computation of eligible export profit under Section 80HHC. The judgment notes that disallowance was called for in respect of ice sales, freezing and cold storage charges, profit on sale of vehicles, and interest on investments.

Which sections of the Income-tax Act were involved?

Section 80HHC

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE HARUN-UL-RASHID TUESDAY, THE 25TH NOVEMBER 2008 / 4TH AGRAHAYANA 1930 ITR.No. 1 of 2004() ------------------- ITA.801/COCH/1992 of I.T.A.TRIBUNAL,COCHIN BENCH .................... APPLICANT(S): -------------- THE COMMISSIONER OF INCOME TAX, TRIVANDRUM. BY ADV. SRI. P.K. R MENON, SR. COUNSEL RESPONDENT(S): --------------- SHRI. A.M. MOOSA, C/O. M/S. BHARAT SEA FOODS, CHANDIROOR, ALLEPPEY BY ADV. THIS TAX REFERENCE HAVING BEEN FINALLY HEARD ON 25/11/2008 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

C .N. RAMACHANDRAN NAIR & HARUN-UL-RASHID, JJ. -------------------------------------------- M.A.C.A. No. 1 OF 2004 -------------------------------------------- Dated this the 25th day of November, 2008 JUDGMENT Ramachandran Nair,J. The question raised in the reference made at the instance of the revenue is whether the items of income referred to in paragraph 2 of the reference should be reckoned while computing eligible exemption of export profit under Section 80HHC of the I.T. Act. We have heard counsel appearing for the revenue and have gone through the order of the Tribunal. We find that out of 8 items referred to in paragraph 2 of the reference order, disallowance is called for in respect of ice sales for Rs. 45,507/-, freezing and cold storage charges of Rs. 1,04,482/-, profit on sale of vehicles of Rs. 19,656/- and interest on investments being only paltry sum of Rs. 537/-. All other items qualify to be considered in the computation of eligible export profits. We therefore dispose of the reference by answering the question substantially in favour of the assessee as stated above and balance in favour of the

2 revenue as stated above. A copy of this judgment under the seal of the High Court and signature of the Registrar-General shall be forwarded to the Income tax Appellate Tribunal, Cochin Bench, for modification of their order consistent with the above decision. (C.N.RAMACHANDRAN NAIR) Judge. (HARUN-UL-RASHID) Judge. kk

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