High Court Of Madras
CIT vs. Rathore Brothers
Section 80HHC (3)(b)
R. Jayasimha Babu & A.K. Rajan, JJ.
Tax Case No. 829 of 1995
31st October 2001
Counsel Appeared
Mrs. Chitra Venkataraman, for the Revenue : V.S. Jayakumar, for the Assessee
JUDGMENT
R. JAYASIMHA BABU, J. :
The question that is referred in this case is, whether, on the facts and in the circumstances of the case, the Tribunal is right in law in holding that cl. (b) of sub-s. (3) of s. 80HHC of the IT Act, 1961, cannot be invoked in this case and the assessee is entitled to relief under s. 80HHC of the Act in respect of the entire export net profits ?
2. The Tribunal has held, and rightly, that the assessee had maintained separate accounts and that its trading receipts and P&L A/c had also been maintained separately for export sales and domestic sales and, therefore, there was no warrant for disallowing any portion of the export earning pro rata by invoking sub-s. (3)(b) of s. 80HHC of the Act. The Tribunal was right in so allowing the decision in its entirety.
3. The purpose of sub-s. (3)(b) of s. 80HHC of the Act is to disallow a part only when the entire deduction claimed cannot be regarded as being relatable to exports. Here, there was sufficient material to show that the income claimed was entirely due to export and was supported by all the necessary documents which were not disputed. We, therefore, answer the question referred to us in favour of the assessee and against the Revenue.
[Citation : 254 ITR 656]
