M/S PALIWAL EXPORTS,PANIPAT vs. DCIT, KARNAL

Since the appeals were heard together so these are being disposed off by this consolidated order for the sake of convenience and brevity.

The grievance of the assessee in the appeal for the assessment year 2000-01 relates to the initiation of the proceedings u/s 148 of the Income Tax Act, 1961 (hereinafter referred to as the Act) and in the appeal for & 747/Del/2011 2 Paliwal Exports the assessment year 2002-03 the grievance of the assessee relates to the deduction u/s 80HHC of the Act. During the course of hearing the ld. Counsel for the assessee at the very outset stated that the reopening was done by the AO on the basis of Taxation Laws (Amendment Act of 2006) which brought about a change for the claim of deduction u/s 80HHC of the Act on profit on the sale of DEPB. It was further stated that when the ld. CIT(A) passed the impugned order, the judgments of the Hon’ble Supreme Court and the Hon’ble Gujarat High Court on this issue were not available and now the issue has been settled by the Hon’ble Gujarat High Court in the case of Avani Exports & Anrs. Vs CIT & Others order dated 02.07.2012, which has been affirmed by the Hon’ble Apex Court and the said decision were to be considered by the ld. CIT(A). Therefore, the matter may be restored to the ld. CIT(A) for adjudication after considering the judgments of the Hon’ble Supreme Court in the case of M/s Topman Exports Vs CIT in Civil Appeal No.1699/2012 order dated 08.02.2012 and CIT Vs Avani Exports & Anothers order dated 01.04.2015 in SLP No. 9273/2013.

The ld. DR in her rival submissions although supported the orders of the ld. CIT(A) but could not controvert this contention of the ld. Counsel for the assessee that the issue agitated in these appeals now have been settled by the Hon’ble Apex Court. & 747/Del/2011 3 Paliwal Exports 5. We have considered the submissions of both the parties and perused the material available on the record. In the present case, it is noticed that the AO reopened the assessment already completed u/s 143(3) of the Act by considering the amendment in the provisions relating to the deduction u/s 80HHC of the Act on the claim of duty draw back claims. The ld. CIT(A) confirmed the action of the AO by observing that the export turnover of the assessee was above Rs. 10 crores and other twin conditions for deduction u/s 80HHC of the Act on DEPB were fulfilled. Now this issue has been settled by the Hon’ble Apex Court in the case of M/s Topman Exports Vs CIT(Mumbai) (supra). As regards to the controversy relating to twin conditions for claiming the benefit of deduction u/s 80HHC after 01.04.2005 on the basis of turnover below and above Rs. 10 crores, it is noted that the issue has been settled by the Hon’ble Apex Court in the case of CIT Vs Avani Exports & Anr. order dated 01.04.2015 in SLP No. 9273/2013 (copy of which was furnished by the ld. Counsel for the assessee which is placed on record). The aforesaid judgments of the Hon’ble Apex Court were not available to the ld. CIT(A) at the time of passing the impugned order. We, therefore, deem it appropriate to set aside these cases to the file of the ld. CIT(A) to be adjudicated afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee and after considering the aforesaid referred to judgments of the Hon’ble Apex Court. & 747/Del/2011 4 Paliwal Exports 6. In the result, the appeals of the assessee are allowed for statistical purposes. (Order Pronounced in the Court on 16/12/2015)