Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “A” BENCH: KOLKATA
Before: Shri Mahavir Singh, JM & Shri Waseem Ahmed, AM]
ORDER Per Shri Mahavir Singh, JM:
This appeal by assessee is arising out of order of CIT(A)-VIII, Kolkata in Appeal No.15/CIT(A)-VIII/Kol/2011-12 dated 29.08.2012. Assessment was framed by DCIT, Circle-7, Kolkata u/s. 254/251/143(3) of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for Assessment Year 2004-05 vide his order dated 31.12.2010.
At the outset, it is noticed that the revenue has moved adjourned petition in almost 19 cases out of the listed case of 23. This en block adjournment is not possible and hence, the possible case, we have taken up for hearing and decided the issue by rejecting the adjournment petition. In this case also, we have rejected the adjournment petition and heard the appeal.
3. The only issue in this appeal of assessee is against the order of CIT(A) confirming the disallowance of deduction u/s. 80HHC of the Act without giving effect to the retrospective amendment to section 80HHC of the Act disentitling the assessee, where export turnover is exceeding Rs.10 cr. For this, assessee has raised following ground nos. 1 to 3: “1. For that the Ld. CIT(A) was grossly erred in confirming the disallowance of deduction u/s. 80HHC amounting to Rs.78,54,054/- claimed by the appellant but not allowed by the Ld. AO in the assessment.
2. For that the order of Ld. CIT(A) is contrary to the judgment dated 02.07.2012 of the Gujarat High Court in the case of Avani Exports Ltd. V. CIT.
For that the appellant be allowed the deduction u/s. 80HHC without giving effect to the retrospective amendment to Sec. 80HHC disentitling the case where export turnover is exceeding Rs.10.00 crores.”
Briefly stated facts are that the assessee claimed deduction u/s. 80HHC of the Act to the tune of Rs.78,54,054/- in view of the proviso to section 80HHC(3) of the Act as inserted by Taxation Law (Second) Amendment Act, 2005 w.e.f. 01.04.1998, which governed the cases having export turnover over exceeding Rs.10 cr. But the AO disallowed the deduction. Aggrieved against the disallowance, assessee preferred appeal before CIT(A), who also confirmed the action of AO by observing as under: “I have carefully considered the written submission furnished before the assessing officer, perused facts of the case and gone through the referred provision of the Act and the observation of the assessing officer. I agree with the view and observation of the AO that the claim of the appellant for deduction u/s. 80HHC is not allowable as per the provisions of the Act in force. After the introduction of third proviso to section 80HHC(3) by the Taxation Law Amendment Act, 2005 w.e.f. 01.04.1998 which governs the deduction for export turn over, it is very clear that the appellant is not entitled to deduction u/s. 80HHC(1). Moreover the fate of the Writ Petition No.191 of 2006 before the Calcutta High Court in the case of RB Agarwala and Co. and others Vs. Union of India and others regarding the applicability of the amendment in the Act on which reliance is placed by the appellant is yet to be known. Besides this, I agree with the observation of the AO that the appellant company is not even a party in the Writ Petition on which the appellant has relied upon. In the light of the above observation and discussion and perusing the facts of the cases and assessment order and materials on records, the action of the AO denying the claim of deduction u/s. 80HHC of the Act is held to be factually and legally justified. Therefore this ground of the appellant is dismissed.”
Aggrieved, now assessee is in appeal before us.
We have heard Ld. Counsel for the assessee and gone through facts and circumstances of the case. We find that this issue stands covered by the decision of Hon’ble Gujarat High Court in the case of Avni Exports & Ors. Vs. CIT (2012) 348 ITR 391 (Guj), wherein the Hon’ble High Court has held that the second amendment to Taxation Laws (second amendment) Act, 2005 wherein 3rd and 4th proviso was inserted wherein the conditions in respect of export turnover of more than Rs. 10 cr. is to be considered for claiming deduction u/s. 80HHC of the Act. Accordingly, the AO is directed to re-compute the deduction by following the amendment brought in the provisos i.e. 3rd and 4th proviso to section 80HHC(3) of the Act by the Taxation Law
3 Sunbio Technology Ltd. AY 2004-05 (Second) Amendment Act, 2005 w.e.f. 01.04.1998 which governs the export turnover exceeding Rs. 10 cr. Accordingly, this issue of the appeal of assessee is allowed. 6. In the result, the appeal of assessee is allowed. 7. Order is pronounced in the open court on 29.10.2015