Deduction under section 80HHC of the Income-tax Act, 1961, in the case of taxpayers engaged in the business of growing and manufacturing tea

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....Dated 23/5/1991 The Board has received representations regarding problems faced by tea exporters in calculating the claim of deduction under section 80HHC of the Income-tax Act. 2. In the case of taxpayers engaged in the business of growing and manufacturing tea, the income chargeable to tax from the sale of tea grown and manufactured in India, is computed under rule 8 of the Income-tax Rule....

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....4. These representations have been considered. The Board is of the opinion that deduction under section 80HHC is to be allowed after the income chargeable to tax under the head "Profits and gains of business and profession" has been computed under rule 8. This is illustrated by the following two examples:--               &n....

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....ses 1,200 Export Sales 1,500 Profits 300 (FOB)     1,500   1,500 Profits from the business   Rs. 300   Allocation under rule 8 :       Income chargeable under I.T. Act 40 per cent   Rs. 120   Agricultural income   Rs. 180   Income chargeable to income-tax ....