TaxTMI 
TaxTMI 
2012 (8) TMI 147
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....filed a return of income for the year 1995-96 on 16-11-1995 declaring the total income of Rs. 8,28,260/- and claiming deduction of Rs. 27,34,139/- under Section 80HHC of the Income Tax Act, 1961 (hereinafter referred to as the 'Act'), The return was processed by the assessing officer under Section 143(1)(a) of the Act on 31-3-1997. The deduction claimed by the assessee under Section 80HHC of the Act was found to be excessive and proceedings under Section 147 of the. Act were initiated and notice under Section 148 of the Act was issued on 6-3-2000. In response to the said notice, the assessee filed the revised return on 9-3-2000 since it was found that in respect of the boat which was purchased and exported which was trading, in view of the ....
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....,000.00 Trade expenses Rs. 8,418,94 Newspapers and Periodicals Rs. 3,253,55 Legal and Professional charges Rs. 5,000,00 Medical aid Rs. 18,240.51 Membership and Subscription Rs. 2,550.00 Travelling expenses Rs. 40,577,00 Security Service charges Rs. 11,000,00 Printing & Stationery Rs. 66,821,48 Repairs and maintenance Rs. 65,375,90 Workmen's compensation insurance Rs. 5,208.00 Service & Gratuity Rs. 30,484,50 Depreciation Rs. 4,25,563.99 Rs. 10,40,640.90 Accordingly, the assessing officer was directed to re-compute the deduction under Section 80HHC of the Act. Being aggrieved by the order of the first appellate authority, the revenue preferred an appeal before the ITAT and the ITAT by the impugned order dat....
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....appearing for the appellant submitted that the first appellate authority had quantified indirect cost which was not attributable to the export by way of trading in respect of boat purchased and exported, the ITAT was not at all justified in setting aside the order and further submitted that the order passed by the first appellate authority would clearly show that only the indirect cost of Rs. 10,40,640.90 is to be proportionately apportioned and not Rs. 18,24,510/-. 6. The learned counsel appearing for the respondent-revenue submitted that the first appellate authority was not justified in excluding certain indirect cost incurred while evaluating indirect costs incurred attributable in respect of trading transaction i.e., purchase and expo....
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....he first appellate authority would clearly show that the appellate authority having found that the assessee had not included indirect cost, not deducted indirect cost in calculating profit for the trading transaction, excluding certain items incurred by the assessee towards indirect cost and held that the items of expenditure to be considered totalling to Rs. 10,40,640.90 should be considered for proportionate calculation of the indirect cost in respect of trading transaction. 8. The provisions of Section 80HHC(3)(b) of the Act reads as follows: "80HHC(3) : For the purposes of Sub-section (1)- (a) ** ** ** (b) Where the export out of India is of trading goods, the profits derived from such export shall be the expor....