TaxTMI 
TaxTMI 
2012 (9) TMI 90
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....duct ion u/s 80HHC on export incentives being DEPB and DFRC. 2. That the learned CIT (A) has erred on facts and in law in making an addition of Rs.1,21,99,519/ -(7794045 on account of 80HHC and 4405484,on account of 80- IB) by making recomputation of deduction u/s 80HHCand 80-IB, which is illegal and arbitrary. 3. That the case of the assessee is directly covered by the Judgment of the Hon'ble Apex Court in the case of M/s Topman Exports V/s CIT, wherein i t has been held that only "Profit" element embedded in the consideration received on transfer of DEPB would be taxable under Clause (iiid) of Section 28 of the Act at the time of calculation of deduction u/s 80HHC of the Act. 4. That the learned CIT(A) has erred in not considerin....
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.... of insertion of clauses (iiid) and (iiie) in section 28 of the Act. The clauses are inserted and deemed to have been inserted w.e.f. 1st April, 1998 and 1st April, 2001 respectively. Effected of these insertion are that the- (a) Profit on transfer of the Duty Entitlement Pass Book Scheme and, (b) Profit on transfer of Duty free Replenishment Certificate being Duty Remission Scheme under the Export/Import Policy formulated and announced u/s 5 of the Foreign Trade. (Development and Regulation) Act, 1992 shall be chargeable to income tax under the head "Profit of Gains of Business of Profession." 9. The two new receipts namely DEPB ands DFRC recognized in clauses (iid) and (iiie) are held to be chargeable under the head Income fro....
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....le means the rate of credit allowable under the DFRC, being Duty Remission. 11. The export turnover in the case of the assessee is Rs. 13,28,47,636/ - which is more than Rs. 10 Crores. The assessee has not filed any evidence to show that the conditions laid down in provision to sect ion 80HHC (3) inserted by Taxation Laws (Amendment) Act 2005, w.r.e. f. 01.04.1998 are satisfied in his case. Moreover the assessee has failed to furnish the detail of Export Incentives at Rs. 1,24,68,289-- in the absence of which it is not possible to quantify the receipts covered under clause (iiid) and (iiie) of section 28 in the light of which the entire amount of export incentives received at Rs. 1,24,68,289/ - is treated to be falling under the same" ....
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....he arguments of AR on this issue have been adjudicated and the claim has been rejected. As such the reworking of claim of deduct ion u/s 80HHC and Sect ion 80IB, being strictly in accordance with the provisions of law, is upheld." 6. We have heard Shri Sudhir Sehgal, Ld. Counsel for the assessee and Shri S.K. Mittal Ld. DR at length and have also perused the materials available on record. At the very outset, Shri Sudhir Sehgal, Ld. Counsel for the assessee pointed out that the issue raised by the assessee vide ground Nos. 1 and 3 of the appeal is squarely covered by the decision of the Hon'ble Supreme Court in the case of Topman Exports v CIT, Mumbai reported in (2012) 67 DTR (SC) 185. Shri Sudhir Sehgal, Ld. Counsel for the assessee sub....