M/S Burlington Agencies v. Jt.commissioner Of Income Tax

-1- IN THE HIGH COURT OF JUDICATURE AT BOMBAY O.O.C.J. Income Tax Appeal No.279 of 2001 M/s Burlington Agencies ..Appellant vs. 1. Jt.Commissioner of Income Tax ..Respondent Ms.A.Vissanji with Mr.S.T.Mehta for appellant. Mr.R.A.Vaishampayan for respondent. CORAM: Dr.S.RADHAKRISHNAN &S.J.KATHAWALLA JJ. 12th August, 2008 CORAM: Dr.S.RADHAKRISHNAN & S.J.KATHAWALLA JJ. 12th August, 2008 P.C. P.C. 1. Heard the learned Counsel appearing for the appellant and the learned Counsel appearing for the respondent. The above appeal was admitted on 6th August, 2004 on the following question of law. "Whether on the facts and circumstances of the case, the appellant is entitled to deduction under section 80-HHC of the sum of Rs.4,77,034/0 or any part of it.?" 2. We have perused the order of Income Tax Appellate Tribunal for the earlier Assessment Year, namely, 1989-90 dated 30th April, 1998. The Tribunal in the said order pointed out that the very same issue of receiving the -2- commission in foreign exchange was entitled to the benefit and all deductions under section 80-HHC of the Income Tax Act and in the said order the Tribunal has in fact quoted the order of CIT (A) in paragraph 3 and has later stated that the aforesaid issue has been covered as per the decision of the Special Bench in the case of International Research Park Laboratories Vs. ACIT reported in 58 ITD 37 infavour of the assessee. 3. We are concerned with the Assessment Year 1990-91 and we have perused the order of the Tribunal dated 22nd February, 2001. The Tribunal has held that in the light of judgment of this Court in CIT Vs.K.K.Doshi and Co. reported in 245 ITR 849 (Bom), the appellant was not entitled to the said deductions under sec.80HHC mainly in view of the fact that in the aforesaid judgment of the CIT Vs. K.K.Doshi, this Court has taken a view that amendment of section 80HHC by Finance Act 2 of 1991 which came into effect from 1st April, 1992 to be with retrospective effect. The said judgment of this Court was challenged before the Hon’ble Supreme Court and Hon’ble Supreme Court in K.K.Doshi and Co. Vs. Commissioner of Income Tax reported in 297 ITR 38 (SC) has overruled the same relying on its own judgment in P.R.Prabhakar Vs. Commissioner of -3- Income Tax reported in 284 ITR 548 (SC) wherein the Hon’ble Supreme Court has clearly held that the aforesaid amendment, namely, Finance Act No.2 of 1991 would be prospective in nature and would not apply to the earlier assessment order. In the said judgment of P.R.Prabhakar Vs. Commissioner of Income Tax in paragraph 17 the Hon’ble Supreme Court has infact quoted the reasons of the Special Bench of ITAT in International Research Park Laboratories Ltd. Vs. Asstt.CIT and has stated that the revenue had not preferred any appeal against the same and in fact the Hon’ble Supreme Court has concurred with the aforesaid view of the Tribunal in International Research Park Laboratories Ltd. Vs. Commissioner of Income Tax in para 18. In the aforesaid facts and circumstances, we answer the above question of law in favour of the assessee and against the revenue. Appeal stands disposed of. (S.J.KATHAWALLA J.) (Dr.S.RADHAKRISHNAN J.) (S.J.KATHAWALLA J.) (Dr.S.RADHAKRISHNAN J.)