Tribunal rectifies order, allows reassessment per Supreme Court decision, correcting error in DEPB claim.

The Tribunal rectified its order dismissing the DEPB claim for computing 80HHC deduction based on a previous High Court precedent, following a recent Supreme Court decision favoring the assessee. The Tribunal acknowledged the mistake and directed the issue to be re-adjudicated by the Assessing Officer in line with the Supreme Court decision. The matter was set aside for a fresh decision by the Assessing Officer, allowing the miscellaneous application.

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Issues involved: Rectification of order by Appellate Tribunal u/s 254(2) of the Income Tax Act, 1961 based on subsequent decision of Hon'ble Supreme Court regarding DEPB claim for computation of 80HHC deduction.

Summary:
The miscellaneous petition was filed challenging the Tribunal's order dated 26/11/2010, which dismissed the DEPB claim for the purpose of computing 80HHC deduction based on a precedent of the Hon'ble Bombay High Court. The petitioner argued that a recent decision of the Hon'ble Supreme Court in Topman Exports case has reversed this view, making the Tribunal's order rectifiable as per the case of Saurashtra Kutch Stock Exchange.

Upon hearing both sides, it was acknowledged that the Hon'ble Supreme Court's decision in Topman Exports favored the assessee. Referring to a similar judgment by ITAT "C" Bench Ahmedabad in the case of Jay Chemicals Industries Ltd., it was concluded that there was an apparent mistake in the Tribunal's order regarding the DEPB claim for 80HHC deduction. The judgment clarified that only profit on sale of DEPB should be considered for exclusion from business profit, with the face value of DEPB to be considered as costs.

Consequently, the Tribunal rectified the mistake in the impugned order and directed the issue to be re-adjudicated by the Assessing Officer in accordance with the decision of the Hon'ble Apex Court. The ground in question was set aside for fresh decision by the Assessing Officer, leading to the allowance of the miscellaneous application.

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