Commissioner Of Income Tax, Jalandhar v. M/S Victor Forgings

-1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 301 of 2010 Date of Decision: 16.8.2010 Commissioner of Income Tax, Jalandhar Versus ....Appellant. M/s Victor Forgings ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Vivek Sethi, Advocate for the appellant. Mr. Rohit Sud, Advocate for the respondent,in ITA Nos. 299, 307, 325 and 367 of 2010. Mr. Pankaj Jain, Advocate for the respondent,in ITA Nos. 306, 327, 337, 338 and 359 of 2010. ADARSH KUMAR GOEL, J. 1.This order will dispose of ITA Nos. 273, 274, 301, 302, 303,304, 306, 307, 309, 322, 324, 325, 327, 328, 329, 330, 331, 332, 333,334, 335, 336, 337, 338, 339, 340, 358, 359, 363, 364 and 367 of 2010as common questions are involved therein. 2.ITA No. 301 of 2010 has been filed by the revenue underSection 260A of the Income Tax Act, 1961 against order dated12.10.2009 passed by the Income Tax Appellate Tribunal, AmritsarBench, Amritsar (in short “the Tribunal”) in ITA No. 611(ASR)/2008 for ITA No. 301 of 2010 the assessment year 2003-04 proposing to raise the followingsubstantial questions of law:- “I. Whether on the facts and circumstances of thecase the ITAT was right in law in not holdingthat the total sale consideration inclusive offace value of DEPB and premium amountreceived thereof represents profit chargeableunder sections 28(iiid) and 28(iiie) of theIncome Tax Act, 1961? II. Whether on the facts and circumstances of thecase the ITAT was right in law in not holdingthat profit on transfer of DEPB entitlementrepresents the entire amount inclusive ofpremium of sale of such DEPB? III. Whether on the facts and circumstances of thecase the ITAT was right in law in holding thatthe word “profit” referred to in section 28(iiid)and 28(iiie) of Income Tax Act, 1961 meansthe difference between the sale price of DEPBand the face value of DEPB ignoring the factthat the entire amount represents the profit inthe hands of assessee? IV. Whether on the facts and circumstances of thecase the ITAT was right in law in deducting theface value of DEPB from sale price of DEPBfor calculating profit under section 28(iiid) and 28(iiie) of Income Tax Act, 1961 as if the facevalue is the cost incurred by the assessee toacquire the DEPB? V. Whether on the facts and circumstances of thecase the ITAT was right in law in holding thatthe word profit referred to in sections 28(iiid)and 28(iiie) of the Income Tax Act, 1961requires any artificial cost to be interpolated tothe extent that the face value of DEPB/DFRCshould be deducted from the sale proceed forthe purpose of determination of deductionunder section 80HHC of the Income Tax Act,1961? VI. Whether on the facts and circumstances of thecase, the ITAT has failed to appreciate thatdeduction u/s 80HHC of the Income Tax Act,1961 was rightly computed in accordance withamendment made by the Taxation Law(Amendment) Act, 2005 with retrospectiveeffect from 01.04.1998?” 3. 3.Learned counsel for the parties in ITA Nos. 91, 299, 306,307, 325, 327, 337, 338, 359 and 367 of 2010 are agreed that thematter is covered by order dated 16.8.2010 passed in ITA No. 299 of2010 (Commissioner of Income-tax v. M/s F.C. Sondhi & Company(P) Ltd.).4.No notice has been issued in ITA Nos. 273, 274, 301, 302, ITA No. 301 of 2010 303, 304, 309, 322, 324, 328 to 336, 339, 340, 358, 363 and 364 of2010. Since the matter is covered, we are of the view that notice toassessee will be a futile exercise. Accordingly, all the appeals aredisposed of in same terms with liberty to the respondents wherever theyare unrepresented to move this Court if they are so advised. 5.Parties may appear before the Tribunal for furtherproceedings on December 20, 2010. 6.A photo copy of this order be placed on the files of the connected cases. (ADARSH KUMAR GOEL) JUDGE August 16, 2010gbs (AJAY KUMAR MITTAL)JUDGE