Commissioner Of Income Tax v. Kajal Exports....opponent(S

O/TAXAP/1792/2005 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 1792 of 2005 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER ================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ?the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ?judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ?to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ COMMISSIONER OF INCOME TAX....Appellant(s) Versus KAJAL EXPORTS....Opponent(s) ================================================================ Appearance: MRS MAUNA M BHATT, ADVOCATE for the Appellant(s) No. 1RULE UNSERVED for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERIandHONOURABLE MR.JUSTICE K.J.THAKER Date : 17/10/2014 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1)This Tax Appeal u/s. 260A of the Income-Tax Act, 1961 is filed against the judgment and order dated 12.5.2005 passed by the Income Tax Appellate Tribunal, Ahmedabad Bench ‘B’ in ITA No.2429/Ahd/1998, whereby the appeal filed by the was allowed for statistical purposes. 2)The facts in brief are that the assessee had filed its return for the assessment year 1995-96 showing total income of Rs.28,400/-. Initially, the return was processed under section 143(A) of the Income Tax Act, 1961 and the assessing officer passed his order. 3)Against the same, the assessee filed an appeal before the Commissioner of Income Tax (Appeals). The CIT (A), vide order dated 23.9.1998, partly allowed the appeal of the assessee. 4)Being aggrieved by the same, the revenue filed an appeal before the Income Tax Appellate Tribunal. The Tribunal, after hearing the parties, partly allowed the said appeal. Hence, this appeal at the instance of the revenue. 5)While admitting the appeal, by an order dated 26.7.2006, the following substantial question of law was framed: “Whether the appellate Tribunal is right in law and on facts in holding that net interest is to be excluded while working out deduction u/s.80IB of the Act instead of gross income required to be excluded?” 6)Learned advocate for the appellant has invited our attention to a decision of the Apex Court in the case of ACG Associated Capsules Pvt. Ltd. v. Commissioner of Income Tax, (2012) 343 ITR 89 and submitted that the issue involved in this appeal is squarely covered by the aforesaid decision. 7)We have heard learned counsel for the respective parties and perused the material on record. We have also perused the decision of the Apex Court relied upon by the learned advocate for the appellant wherein it has been held that ninety per cent of not the gross rent or gross interest but only the net interest or net rent, which had been included in the profit of business of the assessee as computed under the head “Profits and gains of business of profession”, was to be deducted under clause (1) of Explanation (baa) to section 80HHC for determining the profit of the business. Thus the issue is answered against the appellant and in favour of the assesseee. 7)We have heard learned counsel for the respective parties and perused the material on record. We have also perused the decision of the Apex Court relied upon by the learned advocate for the appellant wherein it has been held that ninety per cent of not the gross rent or gross interest but only the net interest or net rent, which had been included in the profit of business of the assessee as computed under the head “Profits and gains of business of profession”, was to be deducted under clause (1) of Explanation (baa) to section 80HHC for determining the profit of the business. Thus the issue is answered against the appellant and in favour of the assesseee. 8)Since the issue is already concluded by the aforesaid decision, we are not assigning elaborate reasons in this appeal. In view of the aforesaid decision of the Apex Court, the present appeal deserves to be dismissed and, accordingly, dismissed. (K.S.JHAVERI, J.) (K.J.THAKER, J) Vahid