Commissioner Of Income Tax, Karnal v. M/S Nice Overseas, 41, Sector 25, Huda, Panipat

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 206 of 2009 (O&M)Date of decision: 24.8.2009 Commissioner of Income Tax, Karnal Vs. M/s Nice Overseas, 41, Sector 25, HUDA, Panipat. ......Appellant ...Respondent CORAM:-HON'BLE MR.JUSTICE ADARSH KUMAR GOELHON'BLE MRS.JUSTICE DAYA CHAUDHARY PRESENT:Mr.Sukant Gupta, Standing Counsel for revenue.Mr.Pankaj Jain, Advocate, for assessee. **** ADARSH KUMAR GOEL, J. (Oral) 1.The revenue has preferred this appeal under section 260A of theIncome Tax Act, 1961 ( for short, “the Act”) against the order of Income TaxAppellate Tribunal, New Delhi, Bench 'SMC' passed in ITA No.821/DEL/2006 on 25.7.2006 for the assessment year 2002-03, proposing toraise following substantial questions of law: “1. Whether on the facts and in thecircumstances of the case, the Hon'ble ITATwas right in law in confirming the order ofthe CIT(A) directing the AO to allowdeduction under Section 80IB on theamount of duty drawn back received by the assessee which cannot be termed as income“derived from” an industrial undertaking asheld by the Hon'ble Supreme Court of Indiain the case of CIT v. Sterling Foods (1999)237 ITR 579 (SC)”? 2.Whether on the facts and circumstances of the case the Ld. ITAT isright in law in allowing deduction underSection 80IB of the Income Tax Act, 1961on the total business profits which includesduty drawn back/export incentives withoutconsidering the provisions of section 80IBunder which the deduction is allowableonly from the income derived from theindustrial undertaking having direct nexuswith the activity of industrialundertaking?” 2.The assessee received export incentives and claimed deductionunder Section 80IB of the Act. The claim of the assessee in respectthereof was disallowed following judgment of the Hon'ble Supreme CourtinCIT v. Sterling Food, (1999) 237 ITR 579. The said view has beenaffirmed by the CIT(A) and allowed the claim of the assessee but theTribunal restored the same, which view was affirmed by the Tribunal. 3. It is not disputed that the matter is covered against the assessee by the judgment of the Hon'ble Supreme Court inSterling Food, (supra)and order of this Court dated 9.9.2008 in ITA No. 629 of 2007 (M/s RajOversease v. The Commissioner of Income Tax, Ludhiana.) Accordingly, the appeal is allowed. The order of the Tribunalis set aside and that of Assessing Officer is restored. (ADARSH KUMAR GOEL) JUDGE August 24, 2009 raghav (DAYA CHAUDHARY) JUDGE Note: Whether this case is to be referred to the Reporter? ........Yes/No