Ravindra Heraeus Private Ltd v. Assistant Commissioner Of Income Tax Circle -I, Udaipur

IN THE HIGH COURT OF JUDICATURE FOR RAJASTHANAT JODHPUR J U D G M E N T D.B. INCOME TAX APPEAL NO. 103/2010 Ravindra Heraeus Private Ltd.Vs.Assistant Commissioner of Income Tax Circle -I,Udaipur DATE : 17/05/2013 P R E S E N T HON'BLE MR. JUSTICE NARENDRA KUMAR JAIN HON'BLE MR. JUSTICE ARUN BHANSALI Mr. Dinesh Mehta, for the appellant Mr. K.K. Bissa, for the respondent BY THE COURT: Heard learned counsel for the parties. 2.While admitting the appeal on 24[th] November,2010 the following substantial questions of law wereframed:- “(1) Whether the Tribunal was justified inholding that the assessee is not entitled toclaim the benefit of Section 80HHC inrespect of the work done by the assesseeunder the name of “Job Charges”? (2) Whether the Tribunal was justified inreversing the findings of the CIT (Appeals)by holding that proceedings initiated underSection 148 for reassessment in respect ofthe assessment year in question are legaland proper and whether the findings recordedin paragraph 16 of the impugned order arelegally justified?” Learned counsel for the respondent has raised an objection that both the questions, which have beenframed while admitting the appeal do not arise eitherfrom the order of the Appellate Tribunal or pleadingsof the parties. He submitted that it appears that dueto inadvertence the questions have been framed. 4.Learned counsel for the appellant has fairlyand frankly admitted this position and submitted thatboth the questions do not arise from the order aswell as pleadings of the parties. However, hesubmitted that the questions, which arise in thepresent matter have been mentioned in Para 7 of thememo of appeal, therefore, the same may be consideredas the substantial questions of law. 5.Learned counsel for the respondent submittedthat none of the questions formulated in the memo ofappeal can be said to be a question of law. 6.We have considered the submissions of learnedcounsel for the parties. 7.As admitted by learned counsel for theparties that the questions formulated by this Courton 24[th] November, 2010 do not arise from the pleadingsof the parties. The said aspect is not in dispute,therefore, the order dated 24[th] November, 2010 to thatextent is recalled. 8.We have again examined the present matter. Itappears that the assessee claimed Rs.29,93,582/- as amount forming part of business profit forascertaining deduction under Section 80HHC. Thesubmission of assessee was that this income was alsofrom export income, therefore, the same is part ofbusiness profit for deduction under Section 80HHC ofthe Income Tax Act. The Assessing Officer did notagree with the submission of the assessee andconsequently, deducted the saiid amount from businessprofit by treating the same as not directly relatedto the business activity of the assessee. The orderof the Assessing Officer was reversed by Commissionerof Income Tax (Appeal). However, on an appeal filedby the assessee, the Income Tax Appellate Tribunalcame to a conclusion that a sum of Rs. 8,37,581/-shown as net gain on exchange rate and Rs. 4,83,263/-shown as commission received are part of profit ofbusiness. Therefore, the assessee was entitled todeduction to that extent under Section 80HHC of theIncome Tax Act. 9.So far as amount of Rs.14,00,817/- towardsreceipt from interest is concerned, the same was nottreated as part of export income and the same wasdecided against the assessee. 10.So far as amount of Rs. 2,72,921/- shown aspostage and insurance charges is concerned, theTribunal has remanded the matter to Assessing Officerwith a direction to verify each and every bill andfind out the correct fact as to whether the assessee BKS/- treated the amount of postage and insurance chargesas a constituent of sale requiring charge of Sale Taxthereon. 9.So far as amount of Rs.14,00,817/- towardsreceipt from interest is concerned, the same was nottreated as part of export income and the same wasdecided against the assessee. 10.So far as amount of Rs. 2,72,921/- shown aspostage and insurance charges is concerned, theTribunal has remanded the matter to Assessing Officerwith a direction to verify each and every bill andfind out the correct fact as to whether the assessee BKS/- treated the amount of postage and insurance chargesas a constituent of sale requiring charge of Sale Taxthereon. 11.This appeal has been preferred only inrespect of amount of Rs.14,00,817/- claimed asinterest received and Rs. 2,71,921/- claimed aspostage and insurance charges. So far as postage andinsurance charges is concerned, the matter has beenremanded to the Assessing Officer and so far asamount of Rs. 14,00,817/- received towards interestis concerned, we find that the Income Tax AppellateTribunal was absolutely justified in coming to aconclusion that the said amount cannot be businessincome. In these circumstances, we find that thejudgment passed by the Income Tax Appellate Tribunalis based on factual aspect of the case and needs nointerference by this Court. 12.In our view, no substantial question of lawarises in the present case and appeal deserves to bedismissed and is hereby dismissed. (ARUN BHANSALI),J. (NARENDRA KUMAR JAIN),J.