Itxa/4881/2010 Of Commissioner Of Income Tax - I v. Jindal Drugs

* 1 *ITXA.4881.2010 17June2011 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 4881 OF 2010 Commissioner of Income Tax Central-I V/S. M/s. Jindal Drugs Ltd ....Appellant....Respondent * * * * Mr. J.S. Saluja, Advocate for the appellant Mr. J.D. Mistry Senior Advocate a/w. Mr. Amit Mehta i/by. Mahimtura & Co., Advocate for the respondent. CORAM :- J.P. DEVADHAR, & SMT. R.P. SONDURBALDOTA, JJ. 17 June, 2011. P.C. :- 1. Heard. 2. Three questions of law are raised by the Revenue in this Appeal. The said questions read thus : (a) Whether on the facts and in the circumstances of the case and in law the Hon’ble ITAT was justified in holding that, only the profit element of the sale of DEPB that is the amount in excess of sale proceeds over the face value is covered under Section 28(iiid) and not the entire amount received on the sale DEPB entitlements represents profit chargeable under Section 28(iiid) of the Income Tax Act, 1961 ? (b). Whether on the facts and in the circumstances of the case and in law, the Hon’ble ITAT was justified in directing the AO to recompute the deduction u/s. 80 HHC in accordance with the view taken by the Special Bench in the case of M/s. Topman Exports ? (c) Whether on the facts and in the circumstances of the case and in law, the Hon’ble ITAT was justified in holding that net amount of interest be deducted from the profit of business to work out deduction under Section 80HHC of the Income Tax Act, 1961 ? 3. As regards the first two questions are concerned, it is seen from the order of the ITAT that the said issue has been remanded back to the file of the Assessing Officer for reconsideration in the light of the Special Bench decision in the case of M/s. Topman Exports V/s. Income Tax Officer in ITA No. 5769/Mum/2006. Since the issue is restored to the file of the Assessing Officer for reconsideration, we are not inclined to entertain these two questions raised by the Revenue. However, since the decision of the Special Bench in the case of M/s. Topman Exports (supra) has been reversed by this Court in the case of CIT V/s. Kalpataru Colours & Chemicals Ltd reported in 328 ITR 451 (Bom), we direct the Assessing Officer to take into consideration the aforesaid decision of this Court while reconsidering those issues. It is made clear that all contentions raised by both the sides including applicability of the proviso to Section 80 HHC are kept open. 4. As regards the third question is concerned, the Counsel for the parties, state that the question decided by the ITAT is different from the question raised before the ITAT. Hence, by consent, the order of ITAT relating to Question (C) is set aside and restored to the file of ITAT for de-novo consideration on the basis of the question raised in the Appeal. The Tribunal while reconsidering the third question shall take into consideration the decision of this Court in the case of CIT V/s. Asian Star Company, reported in 326 ITR 56.The Appeal is disposed off accordingly. [SMT. R.P. SONDURBALDOTA, J] [J.P. DEVADHAR, J]