Mona Dewan v. Income Tax Appellate Tribunal & Ors

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 110 / 2016 Mona Dewan ----Appellant Versus Income Tax Appellate Tribunal & Ors ----Respondent _____________________________________________________ For Appellant(s) : Mr. Samit Bishnoi for Mr. A.K. Bajpai _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE VIJAY KUMAR VYASJudgment 24/04/2017 1.By way of this appeal, the appellant has assailed thejudgment and order of the learned Tribunal whereby the Tribunalhas dismissed the appeal preferred by the assessee and confirmedthe order of the CIT(A). 2.Counsel for the appellant has framed the following questions of law:- “a) Whether the use of word “any” before “profitand gains” in Section 80IB of the Income Taxconstrue that any profit or gain which is linked withbusiness activity and included in the gross totalincome make the assessee eligible for deductionunder Section 80IB. b) Whether the Duty Drawback amount falls underthe category of “profit and gain” and not excludesitself on the ground of being incentive? c) Whether the plurality of the words “profits andgains” make it clear that whatever gain and profitarising out of business has to be considered forgranting the deduction under Section 80IB? d) Whether the words used “derived from the business” include the incentive of Duty Drawbackamount?” 3.However, in view of the observations made by the Tribunal in para 2.3, 2.4 & 2.5 which reads as under:- “2.3 As far as the subsequent decision of the Hon’bleSupreme Court in case of M/s Topman Exports whichthe Ld AR has heavily relied upon, the ld. CIT(A) hasrightly held that the said decision was on differenceissues and facts and hence not applicable in theinstant case as can be seen from the substantialquestions of law raised before the Supreme Courtreproduced as under: (a) Whether the Tribunal is justified in holding thatthe entire amount received on the sale of the DutyEntitlement Passbook does not represent profitschargeable under section 28(iiid) of the I.T. Act, 1961and that the face value of the Duty EntitlementPassbook shall be deducted from the sale proceeds. (b) Whether the Tribunal is justified in holding thatthe face value of the Duty Entitlement Passbook ischargeable to tax under section 28(iiid) at the time ofaccrual of income i.e. when the application for DutyEntitlement Passbook is filed with the competentauthority pursuant to the exports made and that theprofits on the sale of Duty Entitlement Passbookrepresenting the excess of the sale proceeds over theface value is liable to be considered under section28(iiid) at the time of sale.” 2.4 Regarding the decision of Hon’ble Rajasthan HighCourt in case of Saraf Seasoning Udhyog, it is notedthat the said decision relates to receipts on accountof sale of DEPB licences and in view of specificamendment to section 28(iiid), where such receiptshave been brought to tax as business receipts,whether the same will qualify for deduction undersection 80IB of the Act. It is noted that the saiddecision was rendered by Hon’ble Rajasthan HighCourt on 21 August 2008 much before the decision ofHon’ble Supreme Court in case of Liberty India whichwas rendered on 31 August 2009. Secondly, the saiddecision was rendered following the decision ofHon’ble Supreme Court in case of B. Desraj 310 ITR439 without noticing the distinction between therelief u/s 80HHC (where duty drawback receipts to beconsidered subject to certain conditions) and reliefunder section 80IB of the Act. 2.5 In light of above, we do not feel persuaded toaccept the submission made by the ld. Counsel in 2.5 In light of above, we do not feel persuaded toaccept the submission made by the ld. Counsel in view of the settled legal position as held by theHon’ble Supreme Court in case of Liberty India. Thearguments raised by the ld. Counsel do not requiredetailed examination in view of the said settledposition. Therefore, we do not see any reason todeviate from the view taken by the ld. CIT(A) hencethe ground taken by the assessee is dismissed. 4.In view of the subsequent judgment in the case of LibertyIndia (317 ITR 218), no substantial question arises in this appeal. 5.Hence, the appeal being devoid of merit deserves to bedismissed. The same is dismissed. (VIJAY KUMAR VYAS),J. (K.S. JHAVERI),J. A.Sharma/102