TaxTMI 
TaxTMI 
2007 (8) TMI 632
X X X X Extracts X X X X
X X X X Extracts X X X X
....ions of law arise for consideration of this Court:- "1. Whether, on the facts and circumstances of the case, the ITAT was justified in confirming the action of CIT (A) in not allowing legal deduction as claimed by the appellant u/s 80HHC of the Income Tax Act, 1961 by completely ignoring the established principles of law regarding deeming provisions which provide for applicability of all the enabling provisions once an income is held to be business income either on the basis of its accrual, arising on receipt and/or under deeming provisions? 2. Whether, on the facts and circumstances of the case, the ITAT was justified in confirming the action of CIT (A) in not allowing legal deduction as claimed by the appellant u/s 80H....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... 3. The Assessing Officer declined to include an amount of Rs.3,52,581/- arising out of "cessation of trading liability" and held that the assessee was not eligible for the benefit under Section 80 HHC of the Act on the said amount. The assessee took the matter in appeal before CIT (A) who vide order dated 23.9.2004 affirmed the action of the Assessing Officer. He did not allow the claim of the assessee for deduction under Section 80 HHC of the Act with respect to the addition of Rs.3,52,581/-. Feeling aggrieved by the orders passed by the Assessing Officer and the CIT (A), the assessee filed an appeal before the Tribunal and the Tribunal vide its order dated 31.7.2007 partly allowed the appeal. Against the orders passed by the au....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ce to that object. Under sub-section (3) of Section 80 HHC, the mechanism for determination of profits derived from export of goods or merchandise has been prescribed for the purposes of sub-section (1). Clause (a) thereof deals with an assessee where the business is of export of goods or merchandise manufactured by the assessee. Clause (b) relates to an assessee whose business is of export outside India of trading goods whereas Clause (c) applies to an assessee whose business comprised both export of manufactured goods and also of the trading goods. The computation referred to above is to be made having regard to the "profits of the business" which are to be determined in terms of clause (baa) of the Explanation to Section 80 HHC of the Ac....