Anti-double-deduction rule requires section 80-IA relief to be reduced before computing section 80HHC deduction.

Section 80-IA(9) mandates that profits already allowed as deduction under section 80-IA cannot again be deducted under another Chapter VI-A provision, so the same business profits must be reduced before computing deduction under section 80HHC. The article rejects the argument that section 80HHC operates as a self-contained export code immune from this restriction. It applies the plain statutory bar against double deduction and holds that harmonious construction or circular-based arguments cannot override the express language. Relief under section 80-IA must therefore be set off first, and the further deduction under section 80HHC is computed on the reduced business profits.

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Issues: Whether deduction under section 80-IA is to be reduced from business profits before computing deduction under section 80HHC.

Analysis: The controversy turned on the effect of the restriction in section 80-IA(9), which provides that where profits and gains of an undertaking are allowed as deduction under that section, deduction to that extent shall not be allowed under any other provision of Chapter VI-A under the heading "C.-Deductions in respect of certain incomes". The reasoning rejected the contention that section 80HHC is a self-contained export-based code immune from section 80-IA(9). It was held that the statutory restriction is specific, mandatory, and intended to prevent repeated deduction of the same profits. The circular and principles of harmonious construction did not dilute the plain language of the provision, and the restriction had to be given full effect while computing the deduction under section 80HHC.

Conclusion: Relief under section 80-IA must be deducted from the profits and gains of business before computing relief under section 80HHC, and the issue is decided against the assessee and in favour of the Revenue.

Ratio Decidendi: Where Chapter VI-A deductions overlap, a specific anti-double-deduction restriction in section 80-IA(9) prevails and must be applied to reduce business profits before computing a further deduction under another provision of the same Chapter.

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