THE COMMISSIONER OF INCOME TAX vs. SMT.SARITA HANDA
What did the High Court hold?
The High Court held that the substantial questions of law raised in the appeal were covered by the decisions of the Supreme Court in IPCA Laboratories Ltd. Vs. DCIT and Tompan Exports Vs. Commissioner of Income Tax, Mumbai. Consequently, the Assessing Officer was directed to re-compute the deduction under Section 80HHC in accordance with the principles laid down in these Supreme Court judgments. The questions of law were answered based on these precedents. The operative direction was for a re-computation of the deduction. No issue was expressly left undecided.
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) concerning Assessment Year 2001-02. The appeal was admitted on a substantial question of law regarding whether amounts received from the sale of DEPB (Duty Exemption Pass Book) receipts are to be considered 'profit to the business' for the purpose of a deduction under Section 80HHC(4B) of the Act. The specific ITAT order under challenge was ITA No.3537/Del/2004. The High Court noted that the parties were in agreement on the legal questions involved.
What were the issues?
1. Whether the amount received from the sale of DEPB receipts is 'profit to the business' within the meaning of clause (baa) of the Explanation to Section 80HHC(4B) of the Income Tax Act, 1961, for the purpose of claiming deduction under Section 80HHC? (Question of law) Assessee's Contention: The judgment does not record any specific arguments made by the assessee. However, the fact that the appeal was admitted and the subsequent order implies the assessee likely argued in favor of treating DEPB receipts as business profit for Section 80HHC deduction. Revenue's Contention: The judgment does not record any specific arguments made by the Revenue. However, the Revenue's appeal suggests they contended that DEPB receipts should not be treated as business profit for the purpose of Section 80HHC deduction.
Which sections of the Income-tax Act were involved?
Section 28(iv),Section 80HHC,Section 80HHC(4B),Section 260A
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R %
2018
This appeal by the Revenue under Section 260A of the Income Tax Act, 1961 in the case of Sarita Handa relates to Assessment Year 2001-02 and arises from the order of the Income Tax Appellate Tribunal in ITA No.3537/Del/2004. 2. The appeal was admitted vide order dated 5th September, 2005, on the following substantial question of law:- “Whether amount received from sale of DEPB receipts under section 28(iv) and (sic. is) „profit to the business‟ within the meaning of clause (baa) of the Explanation to Section 80HHC (4B) of the Act, 1961?”
The Assessing Officer will accordingly re-compute the deduction under Section 80HHC applying the principles as laid down in the aforesaid decisions.
The questions of laws are accordingly answered without any order as to costs.
SANJIV KHANNA, J
CHANDER SHEKHAR, J JANUARY 19, 2018 b
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