V. M. SALGAOCAR AND BROTHER LIMITED (NOW KNOWN AS V. M. SALGAOCAR AND BROTHER PRIVATE LIMITED., vs. COMMISSIONER OF INCOME TAX, PANAJI-GOA

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TXA/20/2011HC BombayHCBM05001763201130 April 2012Author: A. P. LAVANDE,U. V. BAKRE2 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the appeal. The Court noted that substantial question of law B, concerning whether the loss suffered on export of trading goods ought to be reduced from the total profits of the business for the purposes of Section 80HHC(3)(c)(i), was squarely answered in favour of the appellant by a prior Division Bench judgment of the same High Court dated 27.3.2012 in related appeals. The revenue's counsel did not dispute this. Consequently, substantial question B was answered in favour of the appellant. In light of this, the Court deemed it unnecessary to answer substantial questions A and C. The appeal was allowed with no order as to costs. The ratio decidendi is that if a substantial question of law has already been decided in favour of the assessee by a coordinate bench of the same High Court, and the revenue does not dispute this, the appeal should be allowed on that basis, rendering other related questions academic.

What were the facts?

The appeal was filed by V. M. Salgaocar and Brother Limited (now V. M. Salgaocar and Brother Private Limited) against the Commissioner of Income Tax, Panaji-Goa. The assessment year(s) are not explicitly stated. The challenge is to the order of the Income Tax Appellate Tribunal (ITAT) which, according to the appellant, wrongly held that the Assessing Officer validly exercised jurisdiction under Section 154 of the Income Tax Act to reduce the loss on export of trading goods from total business profits for the purpose of Section 80HHC(3)(c)(i). The procedural history involves the ITAT's decision which is now under challenge before the High Court.

What were the issues?

The High Court had to decide the following substantial questions of law: 1. Whether the Tribunal was right in law in holding that the Respondent had validly exercised jurisdiction under Section 154 of the Act to reduce the loss suffered on export of trading goods from the total profits of the business to arrive at the adjusted profits of the business for the purposes of Section 80HHC(3)(c)(i) of the Act? 2. Whether the Tribunal was right in law in holding that the loss suffered on export of trading goods ought to be reduced from the total profits of the business to arrive at the adjusted profits of the business for the purposes of Section 80HHC(3)(c)(i) of the Act? 3. Whether in view of the merger of the Assessment Order with the First Appellate Order, the Assessing Officer had any jurisdiction to invoke Section 154 of the Income-tax Act to rectify the Assessment Order? Assessee's contentions: Mr. Diniz, for the appellant, submitted that substantial question B is squarely answered in favour of the appellant by a Division Bench of the High Court in a judgment dated 27.3.2012 in Income Tax Appeal Nos. 5/2002, 6/2002 and 7/2002. Revenue's contentions: Ms. Dessai, for the respondent, did not dispute the position stated by the appellant's counsel.

Which sections of the Income-tax Act were involved?

Section 154,Section 80HHC

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF BOMBAY AT GOA TAX APPEAL NO. 20 OF 2011 V. M. SALGAOCAR AND BROTHER LIMITED (NOW KNOWN AS V. M. SALGAOCAR AND BROTHER PRIVATE LIMITED., ... Appellant Versus COMMISSIONER OF INCOME TAX, PANAJI-GOA ... Respondent Mr. A. Diniz, Advocate for the appellant. Ms. A. Dessai, Advocate for the respondent. Coram:- A. P. LAVANDE & U. V. BAKRE, JJ. Date:- 30th April, 2012 P.C. Heard Mr. A. F. Diniz, learned Advocate for the appellant and Ms. A. Dessai, learned Advocate for respondents. 2. The appeal was admitted on the following substantial questions of law:- A. Whether the Tribunal was right in law in holding that the Respondent had validly exercised jurisdiction under Section 154 of the Act to reduce the loss suffered on export of trading goods from the total profits of the business to arrive at the adjusted profits of the business for the purposes of Section 80HHC(3)(c)(i) of the Act? B. Whether the Tribunal was right in law in holding that the loss suffered on export of trading goods ought to be reduced from the total profits of the business to arrive at the adjusted profits of the

business for the purposes of Section 80HHC(3)(c)(i) of the Act? C. Whether in view of the merger of the Assessment Order with the First Appellate Order, the Assessing Officer had any jurisdiction to invoke Section 154 of the Income-tax Act to rectify the Assessement Order? 3. Mr. Diniz, learned Advocate for the appellants submits that the main question of law i.e B arising in appeal is squarely answered against the respondents by the Division Bench of this Court by Judgment dated 27.3.2012 in Income Tax Appeal No. 5/2002, 6/2002 and 7/2002 to which one of us ( A. P. Lavande, J) is a party. 4. Ms. Dessai learned Counsel appearing for the respondent does not dispute this position. 5. In view of the above, the substantial question B is answered in favour of appellant. 6. Having answered substantial question B against the respondent, we do not deem it necessary to answer substantial questions A and C. 7. In view of the above, the appeal is allowed, with no order as to costs. A. P. LAVANDE, J. U. V. BAKRE, J. vn

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