Case Law Details
Whether the amount received by the Assessee from the sale of quota for export of goods could be equated with income mentioned in Sections 28 (iiia) to 28 (iiie) or Section 28 (iv) of the Income Tax Act, 1961 so as to be eligible for a deduction under Section 80HHC of the Act.”
In the said assessment year, the assessee had earned premium of Rs.12,26,140/- on sale of export quota. The Assessing Officer held that this premium is covered by Section 28 (iiia/b/c) and accordingly computed deduction under Section 80HHC but without giving benefit of provisos under sub Section (3) to Section 80HHC. He observed that the export turnover in the previous year was exceeding Rs.10 crores and the assessee had not complied with the several conditions mentioned in the provisos. The sale proceeds received from sale of quota rights were excluded from benefit under the provisos to Section 80HHC(3) as this was not the regular business income of the assessee.
The CIT (Appeals) referred to the circular issued by the CBDT and held that the premium received on sale of export quota represents export incentive and should be treated as covered by Section 28 (iiia/b/c). He did not specifically go into the question whether or not the assessee meets and satisfies the requirements mentioned in the provisos to Section 80HHC(3). The appeal filed by the Revenue before the tribunal met with an order of dismissal dated 31st October, 2008. The tribunal has also not gone into the question whether or not the conditions stipulated in the proviso to Section 80HHC were satisfied.
In the light of what we have argued and answered, the question of law is answered in negative i.e. in favour of the Revenue and against the assessee.
HIGH COURT OF DELHI
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