Wa/1709/2008 Of V.stanley Paulus v. Deputy Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM WEDNESDAY, THE 30TH DAY OF MAY 2012/9TH JYAISHTA 1934 WA.No. 1709 of 2008 ( ) ----------------------- AGAINST THE ORDER/JUDGMENT IN WPC.16181/2004 DATED 30-05-2008 APPELLANT(S)/PETITIONER;:------------------------ V.STANELY PAULUS, S & J SALES CORPORATION, PANAVILA JUNCTION, THIRUVANANTHAPURAM BY ADV. SRI.S.ARUN RAJ RESPONDENT(S)/RESPONDENTS:: --------------------------- 1. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE II, DIVISION I, THIRUVANANTHAPURAM. 2. COMMISSIONER OF INCOME TAX, THIRUVANANTHAPURAM. THIRUVANANTHAPURAM. BY ADV. SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES) BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 30-05-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.N.RAMACHANDRAN NAIR & C.K.ABDUL REHIM, JJ. .................................................................... W.A.No.1709 of 2008 .................................................................... Dated this the 30[th] day of May, 2012. J U D G M E N T Ramachandran Nair, J. Heard Shri.Arun Raj, learned counsel for the appellant and also learned Standing Counsel appearing for therespondents. 2.Return filed was processed by the Assessing Officerunder Section 143(1)(a) of the Income Tax Act (hereinafterreferred to as the Act for short), which resulted in reduction inthe claim of export profit. The appellant filed revision beforethe Commissioner under Section 264 of the Act, which endedup in dismissal. The Commissioner's order was challenged inWP(C) before the learned Single Judge, but without success.Consequently, this Writ Appeal is filed against the judgmentconfirming the Commissioner's order in revision. 3.After hearing both sides and on going through thejudgment and impugned orders, we do not find anyjustification for interference because while making claim on W.A.No.1709/2008 deduction of export profit under Section 80HHC, the assesseecommitted a mistake by reckoning export turnover withoutexcluding so much of the turnover that was not received inconvertible foreign exchange within six months from the endof the financial year. The Assessing Officer reduced this inadjustment under Section 143(1)(a) of the Act. Consequentupon the reduction in the export profit demand went upleading to levy of interest under Sections 234B & 234C of theAct. Common revision was filed challenging part disallowanceof deduction of export profit and levy of interest before theCommissioner, who dismissed the revision. Appellant's claimbefore the lower authorities and before the learned SingleJudge was that when export turnover is reduced to the extentof the amount not received in convertible foreign exchangewithin the statutory period, proportionate reduction shouldhave been granted in direct cost and indirect cost in relation totrading of goods in export. We are unable to uphold theclaim because disallowance of export turnover to the extent ofthe amount not received in convertible foreign exchange W.A.No.1709/2008 -3- within six months from end of the financial year is thestatutory provision contained under Section 80HHC(2)(a) of theAct. Expenditure both direct and indirect are incurred forexport of the commodity and nothing of it is attributable tothe receipt of amount through banking channels. Thereforethere is no ground for allowing appellant's prayer. We,therefore do not find any merit in the challenge against therevised demand of tax. So far as interest demanded isconcerned, it is rather automatic though the appellant has aright to apply for waiver. The appellant is always free to applyfor waiver, and if he has not filed application for waiver, he canstill file it if it is maintainable. This Writ Appeal is disposed of as above. (C.N.RAMACHANDRAN NAIR, JUDGE) within six months from end of the financial year is thestatutory provision contained under Section 80HHC(2)(a) of theAct. Expenditure both direct and indirect are incurred forexport of the commodity and nothing of it is attributable tothe receipt of amount through banking channels. Thereforethere is no ground for allowing appellant's prayer. We,therefore do not find any merit in the challenge against therevised demand of tax. So far as interest demanded isconcerned, it is rather automatic though the appellant has aright to apply for waiver. The appellant is always free to applyfor waiver, and if he has not filed application for waiver, he canstill file it if it is maintainable. This Writ Appeal is disposed of as above. (C.N.RAMACHANDRAN NAIR, JUDGE) (C.K.ABDUL REHIM, JUDGE)