RANBAXY LABORATORIES LTD. vs. THE COMMISSIONER OF INCOME TAX

PDF · subscribers
ITA - 682 / 2007HC Delhi11 December 20082 pages
For Petitioner: MR.VINAY VAISH
AI SummaryAllowed

What did the High Court hold?

The Delhi High Court held that the question of entitlement to deduction under Section 80IA on duty drawback and profit on sale of REP licences is virtually identical to a question previously considered in the context of Section 80IB in the case of CIT v. Dharampal Prem Chand Limited (ITA 1441/2006, decided on 27.11.2008). Following its own precedent in Dharampal Prem Chand, the Court answered the substantial question of law in favour of the assessee and against the revenue. Consequently, the impugned order of the ITAT to the extent it denied the deduction was set aside. The appeal was allowed to this extent. No issue was expressly left undecided.

What were the facts?

The assessee, Ranbaxy Laboratories Ltd., filed an appeal before the Delhi High Court against an order passed by the Income Tax Appellate Tribunal (ITAT). The appeal pertains to the assessment year(s) not specified in the judgment. The core issue revolves around the denial of deduction under Section 80IA of the Income Tax Act, 1961, on duty drawback and profit on sale of REP licences. The procedural history indicates that the ITAT had ruled against the assessee on this point, leading to the present appeal before the High Court. The amount in dispute is not explicitly stated.

What were the issues?

The Tribunal had to decide the following substantial question of law: 1. Whether on the facts and circumstances of the case, the Income Tax Appellate Tribunal erred in law in denying deduction under Section 80IA of the Income Tax Act, 1961, on duty drawback and profit on sale of REP licences? Assessee's Contention: The assessee argued that they are entitled to deduction under Section 80IA on duty drawback and profit on sale of REP licences. The judgment does not explicitly detail the assessee's arguments beyond this entitlement. Revenue's Contention: The judgment does not record any specific arguments made by the revenue in opposition to the assessee's claim for deduction under Section 80IA on the mentioned items.

Which sections of the Income-tax Act were involved?

Section 80IA,Section 80IB

AI-generated summary — verify with the full judgment below

THE HIGH COURT OF DELHI AT NEW DELHI

Judgment delivered on: 11.12.2008

+ ITA 682/2007

RANBAXY LABORATORIES LTD. ... Appellant

- versus –

THE COMMISSIONER OF INCOME TAX NEW DELHI

... Respondent

Advocates who appeared in this case: For the Appellant : Mr Ajay Vohra with Ms Kavita Jha and Mr Sriram Krishna For the Respondent : Ms Rashmi Chopra

CORAM:- HON'BLE MR JUSTICE BADAR DURREZ AHMED HON’BLE MR JUSTICE RAJIV SHAKDHER

1.

Whether Reporters of local papers may be allowed to see the judgment ?

2.

To be referred to the Reporter or not ?

3.

Whether the judgment should be reported in Digest ?

BADAR DURREZ AHMED, J (ORAL) Admit. The following substantial question of law arises for the consideration of this Court:- (1) Whether on the facts and circumstances of the case the Income Tax Appellate Tribunal erred in law in denying deduction under Section 80IA of the Income Tax Act, 1961 on duty drawback and profit on sale of REP licences? 2008:DHC:3301-DB

We find that this question has been recently considered in the context of Section 80IB of the Income Tax Act in CIT v. Dharampal Prem Chand Limited: ITA 1441/2006 decided on 27.11.2008. We can dispose of this question straightaway. We find that the language employed in Section 80IA and 80IB, in the context of the question raised above, is virtually identical. Following the view that we have taken in Dharampal Prem Chand (supra), the question raised above, is answered in favour of the assessee and against the revenue.

To that extent the impugned order is set aside. The appeal stands allowed to this extent.

BADAR DURREZ AHMED, J

RAJIV SHAKDHER, J December 11, 2008 SR

2008:DHC:3301-DB

More judgments on Section 80IA

All 1,796 judgments and leading authorities on Section 80IA →

Recent GST High Court judgments

Search GST case law →