2012 (4) TMI 322

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....unts of incentives by way of duty draw back for treating them as profits derived from industrial undertaking. The Assessing Officer completed the assessment order vide his order dated 26.8.2008 and did not allow the deduction under section 80 IB of the Act. A penalty order was issued on 2.12.2010 under section 271(1)(c). The judgment of the Apex Court in Liberty India versus Commissioner of Income Tax 225 CTR 233(2009) has been relied and referred to while passing the penalty order where the Apex Court has laid down that duty draw back/DEPB are incentives which flow from the schemes framed by the Central Government, hence the incentives/profits are not profits derived from the eligible business and therefore duty draw back received/DEPB ....

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....egard to allowability of deduction under section 80 IB of the Act on the amounts of incentives by way of duty draw back for treating them as profits derived from the industrial undertaking. The Apex Court, subsequent to the date of filing the return of income by the assessee in the case of Liberty India versus CIT (2009) 28 DTR (SC) 173; 317 ITR 218 (SC) 173:317 ITR 218 (SC) clarified the law that receipts from DEPB/DDB are not profits derived from industrial undertaking but are independent source of income. Such a claim of deduction made on the amount of these incentives was not sustainable in law at the time when the return was filed by the assessee. The Apex in the case of CIT vs.Reliance Petroleum Products (P) Ltd. (2010) 322 ITR 158 (S....