Principal Commissioner Of Incometax, Surat-2 v. M/S Florence Exports

C/TAXAP/686/2018 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 686 of 2018 =========================================PRINCIPAL COMMISSIONER OF INCOMETAX, SURAT-2 Versus M/S FLORENCE EXPORTS =============================================Appearance: MRS KALPANAK RAVAL(1046) for the PETITIONER(s) No. 1 for the RESPONDENT(s) No. 1 =============================================CORAM: HONOURABLE MR.JUSTICE M.R. SHAHandHONOURABLE MR.JUSTICE A.Y. KOGJE Date : 21/06/2018ORAL ORDER (PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1.0.Feeling aggrieved and dissatisfied with the impugned order dated 07.07.2017 passed by the ITAT in ITA No.2574/AHD/2014 for AY 2011-12, by which, the learned Tribunal has dismissed the said appeal preferred by the Revenue and has confirmed the order passed by the learned CIT(A) holding that the assessee shall be entitled to exemption under Section 10AA of the Income Tax Act, the Revenue has preferred present Tax Appeal with the following proposed questions of law. A. Whether on the facts and circumstances of the case and the law, Hon'ble ITAT has wrongly allowed deduction u/s 10AA to the assessee? by importing the word "Trading" from SEZ Act, 2005 into Income Tax Act, 1961. The legislature has allowed deduction u/s 10AA to business doing activities of "manufacturing" and "providing services" from SEZ area. Trading of goods from SEZ is nowhere the intention of legislature? B.Whether on the facts and circumstances of the case and law, Hon'ble ITAT has erred in importing the word "Trading" from SEZ Act, 2005 into Income Tax Act, 1961 and gone beyond the intended scope of Section 10 AA of the I.T. Act? C.Whether on the facts and circumstances of the case and in law, Hon'ble ITAT has erred in upholding the order of the ld.CIT (A) allowing deduction of Rs.1,43,47,453/- ignoring that the assessee failed to fulfill the prescribed conditions provided under Section 10AA of the I.T. Act, 1961? 2.0.Heard. Ms. Raval, learned advocate for the Revenue at length. At the outset, it is required to be noted that in the present case the dispute with respect to the deduction / exemption claim under Section 10AA of the Act. The short question which is posed for consideration of this Court is whether the assessee who is operating his business from the unit of SEZ and to carries on trading activities in the nature of exporting shall eligible for exemption under Section 10AA of the ACt. At the outset, it is required to be noted that learned ITAT, Jaipur Bench in the case of DCIT, Circle-2 Jaipur vs. M/s. Goenka Diamond & Jewellers Ltd in ITA No.509/JP/2011 as well as learned ITAT, Mumbai Bench in the case of Assistant Commissioner of Income Tax Central Circle-2, Mumbai vs. Gitanjali Exports Corporation Limited in ITA No.7662/Mum/2013 in detailed considered the similar issue with respect to the exemption of deduction claimed under Section 10AA and same is answered in favour of assessee and against the Revenue. We have gone through and considered the decision of the Jaipur Bench as well Mumbai Bench of the ITAT which are directly on the point. It is not in dispute that the said decisions are not carried further by the Revenue and nothing is reported that any appeal is preferred against the aforesaid decisions. Considering the overall facts and circumstances of the case, when the learned CIT(A) as well as learned Tribunal has observed and held that the assessee shall be entitled to exemption / deduction under Section 10 AA of the Act, it cannot be said that the learned Tribunal has committed any error. Learned counsel for the Revenue is not in a position to point out any contrary decision. Under the circumstances, no substantial question of law arise. In view of the above and for the reasons stated above, present appeal deserves to be dismissed and is accordingly dismissed. overall facts and circumstances of the case, when the learned CIT(A) as well as learned Tribunal has observed and held that the assessee shall be entitled to exemption / deduction under Section 10 AA of the Act, it cannot be said that the learned Tribunal has committed any error. Learned counsel for the Revenue is not in a position to point out any contrary decision. Under the circumstances, no substantial question of law arise. In view of the above and for the reasons stated above, present appeal deserves to be dismissed and is accordingly dismissed. sd/-(M.R. SHAH, J) KAUSHIK J. RATHOD sd/-(A.Y. KOGJE, J)