M/S. GRAPHITE INDIA LIMITED vs. COMMISISONER OF INCOME TAX - IV

PDF · subscribers
ITA/405/2008HC CalcuttaWBCHCO002871200809 January 2026Bench: HON'BLE JUSTICE RAJARSHI BHARADWAJ,HON'BLE JUSTICE UDAY KUMAR2 pages
AI SummaryPartly Allowed

What did the High Court hold?

The High Court held that the substantial question of law is to be answered in the negative and in favour of the assessee. This decision was based on the binding judgment of the Hon'ble Supreme Court of India in Shital Fibers Ltd. Versus Commissioner of Income Tax, [2025] 476 ITR 309 (SC). The reasoning is that the Supreme Court's decision directly addresses the issue of whether deductions under Section 80IA should be reduced while computing profits eligible for deduction under Section 80HHC. The ratio decidendi is that such a reduction is not permissible, as established by the apex court. Consequently, the appeal ITA No. 405 of 2008 was disposed of in terms of the Supreme Court's ruling, implying relief for the assessee. No issue was expressly left undecided.

What were the facts?

The appeal before the High Court at Calcutta (Original Side) was filed by M/s. Graphite India Limited (the appellant/assessee) against the Commissioner of Income Tax - IV (the respondent/revenue). The appeal, bearing number ITA/405/2008, was admitted on August 6, 2008, on a substantial question of law. The core of the dispute revolves around the computation of profits eligible for deduction under Section 80HHC of the Income Tax Act, 1961, and whether deductions allowed under Section 80IA should be reduced from these profits. The judgment does not specify the assessment year(s) or the amount in dispute.

What were the issues?

1. Whether, on the facts and in the circumstances of the case and in law, the Tribunal was right in holding that deduction allowed u/s. 80IA of the Act needs to be reduced while computing Profits of the Business eligible for deduction u/s. 80HHC of the Act? Assessee's contention: The assessee, through its learned senior counsel Mr. Khaitan, argued that the issue is covered by the judgment of the Hon'ble Supreme Court of India in Shital Fibers Ltd. Versus Commissioner of Income Tax, reported in [2025] 476 ITR 309 (SC). Revenue's contention: The learned counsel appearing for the respondent/department, on instruction, agreed with the submission made by the appellant.

Which sections of the Income-tax Act were involved?

Section 80IA,Section 80HHC

AI-generated summary — verify with the full judgment below

OD 1

ITA/405/2008 IN THE HIGH COURT AT CALCUTTA SPECIAL JURISDICTION (INCME TAX) ORIGINAL SIDE

M/S. GRAPHITE INDIA LIMITED VS COMMISISONER OF INCOME TAX - IV

BEFORE: The Hon'ble JUSTICE RAJARSHI BHARADWAJ

-AND- The Hon’ble JUSTICE UDAY KUMAR Date: 9th January, 2026.

Appearance: Mr. J. P. Khaitan, Sr., Adv. Mr. Somak Basu, Adv. Mr. Swagato Kabiraj, Adv. . . .for the appellant.

Mr. Aryak Dutt, Adv. Mr. Madhu Jana, Adv. . . .for the respondent.

The Court: Learned counsel appearing for the appellant refers to the substantial question of law that was admitted on 06.08.2008 by an order passed by their Lordships Hon’ble Justice Pinaki Chandra Ghose and Hon’ble Justice Sankar Prasad Mitra. The substantial question of law is as follows:

2 “Whether on the facts and in the circumstances of the case and in law, the Tribunal was right in holding that deduction allowed u/s. 80IA of the Act needs to be reduced while computing Profits of the Business eligible for deduction u/s. 80HHC of the Act?” Learned senior counsel Mr. Khaitan submits that the issue is already covered by the judgment of the Hon’ble Supreme Court of India in Shital Fibers Ltd. Versus Commissioner of Income Tax, reported in [2025] 476 ITR 309 (SC). Learned counsel appearing for the respondent/department on instruction agrees with the submission made by the appellant. As such, in view of the judgment of the Supreme Court in Shital Fibers Ltd. (Supra), this Court holds the substantial question of law to be in negative and in favour of the assessee. The appeal being ITA No. 405 of 2008 is disposed of.

(RAJARSHI BHARADWAJ, J.)

(UDAY KUMAR, J.)

SP/

More judgments on Section 80IA

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

Recent GST High Court judgments

Search GST case law →