I.t.a v. Ordered Accordingly

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE THOTTATHIL B.RADHAKRISHNAN & THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN FRIDAY, THE 17TH DAY OF AUGUST 2012/26TH SRAVANA 1934 ITA.No. 172 of 2002 ( ) ----------------------- ITA.244/1998 of I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT(S)/APPELLANT: ---------------------- THE COMMISSIONER OF INCOME TAX, TRIVANDRUM. BY ADVS.SRI.P.K.R.MENON(SR.),SR.COUNSEL FOR IT SRI.GEORGE K. GEORGE, SC FOR IT RESPONDENT(S)/RESPONDENT: ------------------------- M/S.NELLIAMPATHY TEA AND PRODUCE CO.LTD. ALAPPUZHA. BY ADV. SRI.A.K.JAYASANKAR NAMBIAR BY ADV. SRI.ANIL D. NAIR THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON17-08-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA.172/2002 APPENDIX PETITIONERS' EXHIBITS:- ANNEXURE A:- TRUE COPY OF THE ORDER OF THE ASSESSING OFFICER DT.27.12.96 ANNEXURE B:- TRUE COPY OF THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DT. 24.3.98 (APPEALS) DT. 24.3.98 ANNEXURE C:- TRUE COPY OF THE ORDER OF THE APPELLATE TRIBUNAL DT.14.1.2002 DT.14.1.2002 RESPONDENTS' EXHIBITS:-NIL OKB/- //TRUE COPY// P.A. TO JUDGE THOTTATHIL B. RADHAKRISHNAN & K.VINOD CHANDRAN, JJ. --------------------------------------------- I.T.A. No.172 of 2002 --------------------------------------------- Dated this the 17[th] day of August, 2012 JUDGMENT Vinod Chandran, J. The above appeal relating to the year 1994-'95 has beenfiled by the revenue raising the following questions of law: “1.Whether, on the facts and in the circumstances ofthe case the assessee whose export business resultedin a loss is entitled to the deduction under section80HHC of the Income Tax Act ? 2. Whether, on the facts and in the circumstancesof the case and since the benefit or deduction is gearedto the profits derivedfrom the export business, doesthe assessee whose export business resulted in a lossis entitled to deduction under section 80HHC of theIncome-tax Act, 1961 ?” The assessee being a company carrying on the business ofplantation along with local trading conducts also export. For therelevant assessment year, the assessee claimed deduction undersection 80HHC, which was declined by the assessing officernoticing that the result of assessee's export business is a loss.The first appellate authority reversed the finding of the assessing officer and granted the deduction claimed, which was confirmedby the Income Tax Appellate Tribunal. The issue is no longer resintegra. The Hon'ble Supreme Court in IPCA Laboratories Ltd.Vs. Deputy Commissioner of Income Tax [(2004) 266 ITR521]and in A.M. Moosa Vs. Commissioner of Income Tax[(2007) 294 ITR 1]held that on an assessee suffering net lossin export business, the entitlement for deduction under section80HHC is not available. In such circumstances, the above appealis allowed answering the questions of law in favour of therevenue and against the assessee. The order of the Tribunal andthe first appellate authority are set aside restoring the order ofthe assessing officer. Ordered accordingly. THOTTATHIL B. RADHAKRISHNAN, JUDGE. K.VINOD CHANDRAN, JUDGE. okb.