TaxTMI 
TaxTMI 
2005 (7) TMI 307
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....otal income at nil. The case was selected for scrutiny. The AO assessed the total income at Rs. 4,61,815. Aggrieved by the order of the AO, the assessee filed an appeal before CIT(A), who partly allowed the appeal. Being aggrieved the assessee is before us. 3. The ground No. 1 of the assessee's appeal is regarding deduction under s. 80HHC. The assessee claimed deduction under s. 80HHC Rs. 20,92,136 against which the AO allowed Rs. 15,63,331. The AO allowed deduction under s. 80-IB firstly on the gross total income and thereafter she allowed the deduction under s. 80HHC on the reduced figure of gross total income. In other words, the AO allowed deduction under s. 80-IB Rs. 6,58,247, which was reduced from the gross total income and th....
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.... while computing the deduction under a particular sections of Chapter VI-A, the amount of income to be considered shall be the income before making any deduction under Chapter VI-A. The s. 80AB has been given an overriding effect over all other sections given in Chapter VI-A. Thus, the s. 80HHC/80-IA(9) are governed by s. 80AB. The learned Authorised Representative relied on the decision of apex Court in the case of IPCA Laboratory Ltd. vs. Dy CIT (2004) 187 CTR (SC) 513 : (2004) 266 ITR 521 (SC), wherein Hon'ble apex Court has held that the s. 80AB has been given an overriding effect over all other sections given in Chapter VI-A. Thus the s. 80HHC/80-IB would be governed by s. 80AB and deduction under s. 80HHC should be allowed on the ....
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....r s. 80-IB first and then after reducing the gross total income by the amount of this deduction under s. 80-IB, the deduction under s. 80HHC was rightly allowed on the reduced gross total income, which resulted the deduction under s. 80HHC at Rs. 15,63,331 as against Rs. 20,92,136 claimed by the assessee. The learned Departmental Representative (has) drawn our attention towards the provisions of s. 80-IA(9), which are applicable for deduction under s. 80-IB also by virtue of s. 80-IB(13), and submitted that the deduction under s. 80HHC shall not be allowed on the amount of deduction allowed under s. 80-IB. She relied on the decision of jurisdictional High Court in the case of CIT vs. Rochi Ram & Sons and decision of Tribunal, Jaipur Bench i....
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....#39;ble apex Court in the case of IPCA Laboratory Ltd. vs. Dy. CIT wherein it has been held that the s. 80AB has an overriding effect over all other sections given in Chapter VI-A. Therefore, whatever mentioned in s. 80-IB or 80HHC would be governed by s. 80AB. So far as the decision of jurisdictional High Court in the case of CIT vs. Rochi Ram & Sons and decision of Tribunal Jaipur Bench in the case of Jt. CIT vs. Gupta Chemical (P) Ltd. is concerned, in both the cases there was no dispute over the deduction under s. 80HHC In both the cases the deduction under s. 80HHC was allowed on gross total income. The relevant para of the judgment Jt. CIT vs. Gupta Chemical (P) Ltd. is reproduced, as under: "............... in this case, the....
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....usiness has been defined in Expln. (baa) which is as under: (baa) "profits of the business" means the profits of the business as computed under the head "Profits and gains of business or profession" as reduced by- (1) ninety per cent of any sum referred to in cls. (iiia), (iiib) and (iiic) of s. 28 or of any receipts by way of brokerage, commission, interest, rent, charges or any other receipt of a similar nature included in such profits; and (2) the profits of any branch, office, warehouse or any other establishment of the assessee situate outside India. The profit has to be taken as computed under the head "Profits and gains of business or profession", which means it cannot be reduced by the deduction allowed....
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....ff by the appellant, the learned Authorised Representative submitted that the amount was not recoverable and written off as bad debts. The learned Authorised Representative submitted that the position of law in this regard is that if the necessary entries are made in the regular books of account regarding the writing off of the amounts, then no further requirement is necessary. The claim regarding written off amount of Rs. 10,034 has been made only after passing the necessary entries in the books of account. 11. On the other hand, the learned Departmental Representative supported the orders of the lower authorities and submitted that the estimation made by the learned AO as regard personal use of telephone is reasonable and disallowance ....