THE COMMISSIONEER OF INCCOEME TAX vs. M/S.ITW SIGNODE [INDIA] LTD

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ITTA/634/2006HC TelanganaHBHC01003672200629 November 2017Author: C.V.NAGARJUNA REDDY,T.AMARNATH GOUD2 pages
AI SummaryDismissed

What did the High Court hold?

The Tribunal, in light of the Supreme Court's decision in Commissioner of Income Tax Vs. Lakshmi Machine Works, held that Excise Duty and Sales Tax do not partake of the character of turnover and therefore are not includable in the turnover under Section 80HHC(3) of the Act. The reasoning is that the Supreme Court has authoritatively settled this issue. Consequently, the substantial questions of law framed in the appeals were answered against the Revenue. The Tribunal did not leave any issue undecided. The operative direction was to dismiss the appeals.

What were the facts?

The appeals were filed by the Commissioner of Income Tax - III, Hyderabad (Revenue) against M/s. Andhra Pradesh Paper Mills (assessee). The assessment years are not explicitly stated. The appeals challenge the orders of the Income Tax Appellate Tribunal (ITAT) concerning the deduction under Section 80HHC of the Income Tax Act, 1961. The core dispute revolves around whether Sales Tax and Excise Duty should be included in the 'Total Turnover' for the purpose of calculating the deduction under Section 80HHC. The procedural history indicates these are appeals from ITAT orders, and the Revenue is the appellant.

What were the issues?

1. Whether Sales Tax and Excise Duty are part of 'Total Turnover' for the purpose of deduction under Section 80HHC of the Income Tax Act, 1961, and liable to be excluded from the said turnover for the purpose of deduction under the said provision. (Question of law) The Revenue's contention, as presented by its counsel, was that Sales Tax and Excise Duty should be included in the 'Total Turnover' for the purpose of deduction under Section 80HHC. The assessee's contentions are not recorded in the judgment. The Revenue relied on the Supreme Court's judgment in Commissioner of Income Tax Vs. Lakshmi Machine Works.

Which sections of the Income-tax Act were involved?

Section 80HHC,Section 80HHC(3)

AI-generated summary — verify with the full judgment below

THE HON'BLE SRI JUSTICE C.V.NAGARJUNA REDDY AND THE HON'BLE SRI JUSTICE T.AMARNATH GOUD

I.T.T.A.Nos. 298 & 308 OF 2005 AND 176 & 634 OF 2006

DATED 29TH NOVEMBER, 2017

I.T.T.A.No. 298 OF 2005

Between:

The Commissioner of Income Tax – III, Hyderabad

… Appellant

AND M/s. Andhra Pradesh Paper Mills, 5th Floor, Swapnalok Complex, S.D.Road, Secunderabad

… Respondent

Counsel for the appellant

: Sri B.Narasimha Sarma

Counsel for the respondent

: Sri Challa Gunaranjan

THE COURT MADE THE FOLLOWING

2 COMMON JUDGMENT: (per Hon'ble Sri Justice C.V.Nagarjuna Reddy) The main question of law raised in these appeals by the Revenue is whether Sales Tax and Excise Duty are part of "Total Turnover" for the purpose of deduction under Section 80 HHC of the Income Tax Act, 1961 (for short, 'the Act'), and liable to be excluded from the said Date: 29-11-2017. T.AMARNATH GOUD, J. JSK

1 (2007) 290 ITR 667 (SC)

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