Profit element on sale of DEPB, i.e., the amount in excess of sale proceeds over the face value is covered u/s 28(iiid)

S. 80HHC; in favor of taxpayer: Post the amendment by Taxation Law Amendment Act, 2005 (effective from 1 April 1998), controversy had arisen as to whether in case of an exporter having export turnover of more than INR100 million (where generally conditions mentioned in  section 80HHC cannot be satisfied), the entire sale proceeds of DEPB need to be excluded while calculating the deduction under  Section 80HHC or only profit on transfer of DEPB should be  excluded.

To deal with this controversial issue, a Special Bench  was

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