Commissioner Of Income-Tax v. M/S Sheena Industries, Ujha Road, Panipat

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No. 917 of 2008DATE OF DECISION : 23.11.2009 Commissioner of Income-tax .... APPELLANT Versus M/s Sheena Industries, Ujha Road, Panipat ..... RESPONDENT CORAM :- HON'BLE MR. JUSTICE SATISH KUMAR MITTALHON'BLE MR. JUSTICE MEHINDER SINGH SULLAR Present:Mr. K.K. Mehta, Advocate,for the appellant-revenue. * * * SATISH KUMAR MITTAL , J. The revenue has filed this appeal under Section 260-A of theIncome Tax Act, 1961 (hereinafter referred to as `the Act'), against the orderdated 31.8.2007, passed by the Income Tax Appellate Tribunal, DelhiBench, `I', New Delhi (hereinafter referred to as `the ITAT') in ITA No.1228/Del/2006, pertaining to the assessment years 2002-03, raising thefollowing substantial questions of law :- “Whether on the facts and in the circumstances of thecase, learned ITAT was right in law in upholding theorder of the CIT (A), directing the A.O to allowdeduction u/s 80 HHC on export incentives, received bythe assessee, as a supporting manufacturer in the samemanner, as in the case of direct exporter?” In the present case, the assessee is a partnership firm derivingincome from the manufacturing and sale of textile goods to M/s IKEATrading (India) Ltd., (an Export/Trading House) as supportingmanufacturer. In the assessment framed under Section 143 (3) of the Act,the Assessing Officer did not accept the contention of the assessee forcomputing deduction allowable to him under Section 80 HHC of the Act asper the provision of Section 80 HHC (1A) read with Section 80 HHC (3A)read with clause (baa) of explanation of Section 80 HHC of the Act, as therespondent is a supporting manufacturer, and allowed deduction ofRs.1,40,49,120/- under Section 80 HHC of the Act, instead ofRs.7,19,78,869/-, as claimed by the assessee. On appeal by the assessee, theCommissioner of Income Tax (Appeals), Karnal, set aside the order of theAssessing Officer and held that the assessee was entitled to the deductionunder Section 80 HHC of the Act, as supporting manufacturer in the samemanner, as in the case of direct exporter. The said decision of the CIT (A)has been upheld by the ITAT vide order dated 31.8.2007, against which theinstant appeal has been filed, raising the aforesaid substantial question oflaw.After hearing counsel for the appellant, we find that in ITA No.296 of 2008, filed by the revenue, the similar substantial question of lawwas raised to the following effect : “Whether on the facts and in the circumstances of thecase, the Ld. ITAT was right in law in upholding the order of the CIT (A), directing the Assessing Officer toallow deduction under section 80 HHC to the assesseewho is a supporting manufacturer in the same manner, asin the case of direct exporter, treating the supportingmanufacturer at par with direct exporter and ignoring theprovisions of Section 80 HHC (1A) read with Section 80HHC (3A) read with clause (baa) of explanation toSection 80 HHC of the Act?” The aforesaid appeal was dismissed by this Court, while relying upon thejudgment of the Supreme Court in Commissioner of Income Tax,Thiruvanantapuramv. Baby Marine Exports(2007) 290 ITR 323 (SC),and upheld the claim of the assessee under Section 80 HHC of the Act as asupporting manufacturer at par with the direct exporter. This fact has notbeen disputed by learned counsel for the appellant. In view of the above, no substantial question of law survivesfor our determination. Thus, we do not find any merit in this appeal and thesame is, hereby, dismissed. ( SATISH KUMAR MITTAL )JUDGE November 23, 2009 ndj ( MEHINDER SINGH SULLAR )JUDGE