COMMISSIONER OF INCOME TAX vs. M/S HIGH POLYMER LABS LTD.

IN THE HIGH COURT OF DELHI AT NEW DELHI . ITA 133/2006 . COMMISSIONER OF INCOME TAX ..... Appellant Through Ms. P.L.Bansal, Advocate . versus . M/S HIGH POLYMER LABS LTD. ..... Respondent Through Mr. Badri Nath, Advocate . . . CORAM: HON'BLE MR. JUSTICE MADAN B. LOKUR HON'BLE MR. JUSTICE VIPIN SANGHI O R D E R 22.08.2006 In this appeal under Section 260A of the Income Tax Act, 1961 the Revenue has raised several questions. One of the questions that raised by the Revenue is whether Excise Duty does not form a part of the total turn over for the purposes of computing deductions under Section 80HHC of the Act. Learned counsel for the Revenue fairly points out in ITA No. 331/2004, (Commissioner of Income Tax vs. Rollatainers Ltd. decided on 12th July, 2004) this Court has already declined to admit an appeal raising a similar question of law. She also says that in Commissioner of Income Tax vs. Chloride India Ltd., [2002] 256 ITR 625 and Commissioner of Income Tax vs. Sudarshan Chemicals Industries Ltd., [2000] 245 ITR 769, a view has been taken by the Calcutta High Court and by the Mumbai High Court respectively in favour of the assessee and against the Revenue. Following the decisions in the aforesaid cases as well as the view expressed by this Court in Rollatainers, we are of the view that so far as this issue is concerned, the Revenue has not raised any substantial question of law. However, the Revenue has raised two other substantial questions of law, which fall for our consideration. We admit this appeal in respect of those two questions and formulate them as under :- 1) Whether the Income Tax Appellate Tribunal was correct in law in holding that the assessee is entitled to reduce interest paid by it on bank overdrafts from the interest received on FDRs while calculating deductions under Section 80HHC read with Explanation (baa) of the Income Tax Act, 1961. . 2) Whether the Income Tax Appellate Tribunal was correct in law in holding that profit from the sale of EDP receipts under the duty remission scheme cannot be excluded from the profits of business as per Explanation (baa) for purposes of computing the deductions under Section 80HHC of the Income Tax Act, 1961. . . Paper books be filed in accordance with the High Court Rules. . . . . MADAN B. LOKUR, J . . . VIPIN SANGHI, J AUGUST 22, 2006 mw