2016 (1) TMI 1088

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.... of the same by this common order. 2. Let us first take up Revenue's appeal I.T.A.No. 250/Mds/2015. The only issue arises for consideration is deduction u/s 80HHC of the Act without reducing the deduction allowed u/s 80IB of the Act. 3. Dr.U.Anjaneyulu, ld. Departmental Representative submitted that the assessee claimed deductions u/s 80HHC and 80IB of the Act. The Assessing Officer found that in view of sec. 80IA(9) of the Act, the deduction granted u/s 80HHC shall be reduced while considering the deduction u/s 80IB of the Act. However, the CIT(A) has allowed the claim of the assessee on the basis of decision of this Tribunal in the case of M/s Rane Brake Lining Ltd in I.T.A.No. 104/Mds/2009, dated 21.4.2011. According to the ld. DR,....

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.... CIT [1998] 229 ITR 123 and Apex Court in Jt. CIT vs Mandideep Engineering and Packaging Industries P. Ltd [2007] 292 ITR 1, found that deduction allowed u/s 80HHC need not be reduced while computing deduction u/s 80IA of the Act. In view of the judgment of Bombay High Court in Nima Specific Family Trust(supra) which was followed by the jurisdictional High court in MRF Ltd. (supra), this Tribunal do not find any reason to interfere with the order of the lower authority. Accordingly, the same is confirmed. 6. Now, coming to assessee's appeal I.T.A.No.298/Mds/2015, the first ground of appeal is with regard to inclusion of receipt from scrap sales in the total turnover. 7. Shri R. Vijayaraghavan, ld. Counsel for the assessee submitted th....

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.... from the amount spent by the manufacturing unit on the raw material from which goods are manufactured. The raw material which is not capable of being used for manufacturing the goods will have to be either sold as scrap or might have to be recycled. When such scrap is sold, the sale proceeds cannot be included in the total turnover. Therefore, the proceeds of the sale of such scrap would not be included in the sales in the Profit & Loss Account of the assessee. In the case before us, the assessee is admittedly a manufacturing company, therefore, the sale proceeds of the scrap cannot form part of the total turnover. Therefore, we are unable to uphold the order of the lower authority. In view of the judgment of the Apex Court in Punjab Stain....

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.... issue arises for consideration is exclusion of 90% of interest, agency commission, rent and miscellaneous income from the profits of business while computing deduction u/s 80HHC. 15. Shri R.Vijayaraghavan, ld. Counsel for the assessee submitted that the Assessing Officer has excluded 90% of the gross income while computing deduction u/s 80HHC. Referring to Explanation (baa) of sec. 80HHC, the ld. Counsel submitted that the income which is miscellaneous in nature has to be excluded in case it forms part of the profit of the assessee. According to the ld. Counsel, what is included in the profit of the business is net receipt of the assessee and not the entire receipt. Therefore, the Assessing Officer has to confine himself only to the net....