TaxTMI 
TaxTMI 
1998 (4) TMI 544
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....; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} VIMAL GANDHI, VICE-PRESIDENT AND M.V.R. PRASAD, ACCOUNTANT MEMBER For the Appellant : Hero Rai For the Respondent : P.N. Prasad ORDER Per Shri Vimal Gandhi, V.P. - This appeal by the assessee for the assessment year 1992-93 is directed against the order of the CIT revising assessment order dated 14-11-94 under section 263 of the Income-tax Act to reduce deduction allowed under section 80HHC of the I.T. Act. According to the learned CIT, the Assessing Officer excluded....
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....or purposes of this section are to be reduced by 90 per cent of any sum referred to in the three clauses of section 28 or of any receipts by way of brokerage, commission, etc. as provided in item (1) referred to above. It is the case of the learned CIT that while making 90 per cent of deduction of consultancy fees, the Assessing Officer took into account amount of 1,78,528 whereas he should have taken net amount of 6,84,972. In other words, the commission paid for earning commission was not to be deducted. 3. Shri Hero Rai, the learned Advocate of the assessee, vehemently argued that for purposes of above section, what was to be deducted was "net amount of receipt" and not "gross amount". He cited and relied upon the decision of the Hon'....
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....n are required to be reduced by 90 per cent of receipts mentioned in the clause and included in "such profits", i.e., profits and gains of business. Thus, receipts to be deducted are controlled by the words "included in such profits" and the matter is to be resolved by looking at the receipt which is included in the "profits and gains of business". In a case where the receipt included in the computed profit is clear and there is no dispute about the receipt or the expenditure claimed against such a receipt, the particular quantum included in "such profit" has to be taken into account. This figure cannot be different from the one included in "such profit". This proposition is supported by following observation of the Hon'ble Supreme Court in....
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....net income different formulae like proportionate receipt, etc. were suggested. In order to override such a situation, the Legislature has laid down a formula uniformly applicable. Thus, where expenditure against type of receipts is not available, 90% of such a receipt is to be deducted for determining profits of business. Having regard to the purpose, setting and language of the statutory provision, there is no justification to hold that first net receipt included in the profit of business be estimated (determined) and thereafter 90% of the same should be deducted from the computed profits of business. The Legislature has laid down that 90% of receipt is to be deducted from "profits of business" and there is no justification to deviate from....