KA vs. ET EXPORTS PVT LTD

,,." ( $-'15. * IN THE HIGH COURT OF DELHI AT NEW DELHI rTA 688/2011 KAVSET EXPORTS PVT LTD. ..... Appellant Through Mr. Somnath Shukla, Advocate. clT VETSUS rhrous h Mr. Harpr"", s;;;nTiilildent Advocate. GORAM: HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE R.V.EASWAR ORDER % 06.03.2012 Vide order dated zgrh August, 2011, the following substantial questions of law were framed: "(1) Whether on the facts and in the circumstances of the case, the Tribunal erred in law in holding that 90% of (a) of face value of the DEPB credit earned during the year and (b) the entire value received/receivable on transfer of Duty Entitlemenf Pass Book credit ('DEPB credit") has to be excluded while computing "profits of the business" in terms of explanation (baa) fo Secfion 80HHC read with Section 28(iiid) of the Act? (2) Whether on the facts and in the circumstances of the case, the Tribunal erred in law in not holding that only premium Digitally Signed By:AMULYA Signature Not Verified

,1 1t received on transfer of DEPB credit is required to be reduced for computing "profits of the business" in terms of Explanation (baa) fo Secfio n 80HHC read with Section 2B (iiid) of the Act? (3) Whether on the facts and in the circumstances of the case, the Tribunal erred in law in not appreciating that, in any case, no part of the DEPB credit received during the relevant previous year, which was not transferred was.required to be reduced while computing the "profits of the busrness" in terms of Explanation(baa) to Section 80 HHC read with Section 28(iiid) of the Act." 2. This appeal pertains to assessment year 2003-04 and the question involved relates to deduction under Section B0HHC of the Income Tax Act, 1961 (Act, for short). 3. Learned counsel for the parties agree that the questions of law mentioned above are covered by the decision of the Supreme Court in the case of Topman Exports yersus CIT , Civil Appeal No. 169912012 and other cases, decided on 8th February,2012. 4. Accordingly, in terms of the said decision, the first two questions of law are answered in negative, i.e., in favour of the appellant-assessee and against the respondent-Revenue and it is held that the face value of the DEPB credit is to be treated as cash assistance under Section 28(iiib) of the Act' t

a 5. Learned counsel for the appellant admits that in this year there is no transfer of DEPB credit. ln these circumstances, question No. 3 need not be answered. We clarify that the aforesaid concession/submission does not mean that the assessee will not be entitled to benefit on the transfer amount I. under Explanation(paa)to Section BOHHC of the Act in any other year if it is admissible and permissible and is made in accordance with law. Accordingly, the Assessing officer will re- compute the deduction under section 80 HHC of the Act. The appeal is disposed of. No costs. -4-'1 tt SANJIV KHANNA, Itl,--*. R.V. EASWAR, J. MARCH 06,2012 VKR cal J.