Nahar Spinning Mills Ltd v. Commissioner Of Income Tax

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No.63 of 2002 (O&M)Date of decision: 18.4.2011 Nahar Spinning Mills Ltd. Vs. Commissioner of Income Tax. -----Appellant. -----Respondent. CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOELHON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present:-Mr. Sanjay Bansal, Sr. Advocate withMs. Shweta Malhotra, Advocatefor the appellant. Ms. Shweta Malhotra, Advocatefor the appellant. Mr. Denesh Goyal, Standing Counselfor the respondent. --- ADARSH KUMAR GOEL, J. This appeal has been preferred by the assesseeunder Section 260-A of the Income Tax Act, 1961 (for short, “theAct”) against the order of the Income Tax Appellate Tribunal,Chandigarh in ITA No.191/CHD/93 and C.O. No.56/CHD/93 forthe assessment year 1989-90 claiming following substantialquestions of law:- “1.Whether a proper construction of section 80-I andproper understanding of the Supreme Court’s decisionreported in ITR 237 Page 579, in the case of SterlingFoods, the Tribunal did not err in law in holding thatproper understanding of the Supreme Court’s decisionreported in ITR 237 Page 579, in the case of SterlingFoods, the Tribunal did not err in law in holding that 6. the income received by the assessee by way of CCAdid not qualify for exemption from tax to the extentindicated in the said section? Whether on the facts and circumstances of the casethe Tribunal did not err in law in holding that theincome received by the assessee being of verynature, that is additional price for exports could not besaid to be income derived from the industrialundertaking of the assessee within the meaning ofSection 80-I of the Income Tax Act? Whether on the facts and circumstances of the casethe Tribunal did not err in holding that profits or sale ofimport entitlements were of the same nature as CCAreceived? Whether the Tribunal did not err in holding that onlysuch profits of an industrial undertaking were exemptfrom tax u/s 80-I as were obtained from sale ofmanufactured goods? Whether on the facts and circumstances of the caseand on proper construction of section 80-I the ITATdid not err in law in holding that the interest incomeearned on fixed deposits in the circumstances theywere made with the banks could not be adjudged asincome derived by the assessee undertaking withinthe meaning of section 80-I and 80 HHC of theIncome Tax Act? Whether on the facts and circumstances of the caseand on proper construction of provisions of section80HHC, the ITAT did not err in law in holding that theinterest income derived from fixed deposit receipttaken for L/Cs or guaranty would not be construed asprofits and gains of the business of the assessee within the meaning of Section 80 HHC of the IncomeTax Act?” Learned counsel for the appellant fairly states that thematter is covered against the assessee by judgment of theHon’ble Supreme Court inLiberty Indiav. CIT(2009) 317 ITR218. Accordingly, this appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE April 18, 2011ashwani ( AJAY KUMAR MITTAL ) JUDGE