The Commissioner Of Income-Tax, Karnal v. M/S Liberty Shoes Ltd

Income-tax Appeal No.711 of 2010 -1- **** IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH Income-tax Appeal No.711of 2010 Date of decision: 17.12.2010 The Commissioner of Income-Tax, Karnal ...Appellant Versus M/s Liberty Shoes Ltd. ...Respondent CORAM: HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MR.JUSTICE AJAY KUMAR MITTAL Present: Mr. Yogesh Putney, Advocate for the appellant. **** ADARSH KUMAR GOEL, J ( Oral). 1.This appeal has been preferred by the revenue underSection 260A of the Income Tax Act, 1961 against order dated9.10.2009 passed by the Income Tax Appellate Tribunal, Delhi Bench(D), Delhi in ITA No.139/Del/2009, for the assessment year 2004-05,proposing following substantial questions of law:- “a).Whether on the facts and circumstances of thecase, the ITAT was justified in allowing deductionsu/s 80HHC on the face value of DEPB in the casewhere turnover exceeds Rs.10 crores in view of (ii),(iii) and (iv) provisions inserted by the TaxationLaws (Amendment) Act, 2005 with retrospectiveeffect from 1.4.1998? b).Whether on the facts and circumstances of thecase, the ITAT was justified in allowing deductionsu/s 80HHC in respect of entire DEPB amount byincorporating the same in the computation ofbusiness profit u/s 28(iiib)? c)Whether on the facts and circumstances of thecase, the ITAT was right in categorizing the DEPBas cash assistance without appreciating that thelegal fiction created by Section 28(iiib) cannot beextended to incorporate any other export benefitentirely different nature? d)Whether on the facts and circumstances of thecase, the ITAT was justified in allowing deductionsu/s 80HHC on bank interest and other interest bytreating this income from profit and gains ofbusiness?”case, the ITAT was justified in allowing deductionsu/s 80HHC on bank interest and other interest bytreating this income from profit and gains ofbusiness?” 2.Learned counsel for the revenue states that with regard toquestions (a) to (c), the matter is covered in favour of the revenue byorder of this Court dated 16.8.2010 in ITA No.299 of 2010(Commissioner of Income-Tax Vs. M/s F.C.Sondhi & Company(P) Ltd.) while with regard to question (d) the matter is covered infavour of the revenue by the decision of this Court inRani Paliwal Vs. Commissioner of Income-Tax(2004) 268 ITR 220. 3.In view of the above, following the earlier decisions of thisCourt, the matter is remanded to the Tribunal for fresh decision in **** accordance with law. It is, however, made clear that if therespondent-assessee is aggrieved by this order, it can approach thisCourt. 4.Accordingly, the appeal is disposed of. (Adarsh Kumar Goel) Judge December 17,2010Pka (Ajay Kumar Mittal) Judge