2008 (5) TMI 285

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....are as follows: Appellant is the sole proprietor of M/s D.R. Enterprises engaged in the business of export of textiles/fabrics since 1st Feb., 1980. As part of his business, appellant has been exporting fabrics to Chittagong and Dhaka. Consequent upon exports made by the appellant, inward remittance came into India in foreign exchange on 21st Aug., 1989, 11th Dec., 1989, 28th Feb., 1990, 16th March, 1990, 29th March, 1990 and 31st March, 1990. In other words, inward remittance came into India during the accounting year ending 31st March, 1990 (relevant asst. yr. 1990-91). However, appellant received cash compensatory allowance amounting to Rs. 7,74,785 on 25th May, 1990 (i.e. in the next accounting year). He also received on the same ....

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.... 1st Aug., 1990 [(1990) 86 CTR (St) 41 : (1990) 185 ITR (St) 9] in which it has been specifically mentioned that in computation of deduction under s. 80HHC the business profits would include export incentives. We will come to that formula later on. Suffice it to say that the decision of the CIT(A) was upheld by the Tribunal. Aggrieved by the decision of the Tribunal the Department carried the matter in appeal to the Madras High Court vide Tax Case (Appeal) No. 134 of 2003. 8. By the impugned judgment the High Court overruled the decision of the Tribunal on the ground that during the asst. yr. 1991-92 the assessee had received cash compensatory support and duty drawback for the exports made in the earlier year and that there were no expor....

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....s. 80HHC. 11. As stated above. at one point of time this controversy did exist which led to the issuance of the said circular. Therefore, we have to reject the above argument advanced on behalf of the Department. 12. As stated above, the formula is indicated in s. 80HHC(3). We quote hereinbelow the said formula:                            "Export turnover (sale proceeds                              actually received in foreign Profit of the business  ....