TaxTMI 
TaxTMI 
2016 (10) TMI 505
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....eads as under: "2 The Tribunal, in para 6 of its order, had summarized the entire controversy, which is reproduced below for the sake of convenience: "6 The rival submissions in regard to the above have been very carefully considered. The Tribunal in the case of the assessee for the assessment year 198283 considered the claim of quantum of deduction under section 80-O i.e. gross or in the manner laid down under Section 80AB of the Act by referring to the Supreme Court decision in Distributors (Baroda) P. Ltd. (supra) where the provisions of section 80AB were considered specifically. Despite the fact that the provisions of Section 80AB were not in the statute book during the previous year relevant to the assessment year that was before the Supreme Court, the Supreme Court had upheld the applicability on a principle. The Tribunal would have referred to the provisions of section 155(12) of the Act and observed that these provisions were intended to give relief to the assessee on the basis of amounts received in foreign currency. They held that the intention of the legislature was not to allow relief to the assessee with reference to the gross income. In so far as the apportionmen....
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....nishes a certificate from the auditor in the prescribed Form 50 per cent of the profits and gains so referred earlier is debited to the profit and loss account of the previous year etc. etc. and the proviso to this section states that where the amount credited by the assessee to the Foreign Project Reserve Account in pursuance of clause (ii) or the amount brought in to India by the assessee in pursuance of clause (iii) or each of the said amounts is less than 50 per cent of the profits and gains referred to in subsection (1), the deduction under that subsection shall be limited to the amount so credited in pursuance of clause (ii) or the amount so brought into India in pursuance of clause (iii), whichever is less. The reading of section 80-O suggests that the gross total income of the assessee should include income for which deduction is allowable under section 80-O. The said income must be received in convertible foreign exchange in India and the amount of deduction is to the extent of 50 per cent of the income received in India. This indicates that the term 'Income' is with reference to the income that is included in the gross total income and not necessarily the quantum ....
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....restoration of Income Tax Appeal No.5 of 2000. However, the above order dated 30th April, 2015 itself clarified that the questions raised therein are left open for consideration in an appropriate case, if not already decided. Therefore, the question raised in this Reference is being independently considered. 6 From the statement of case as set out hereinabove, the controversy revolves around the extent of availability of deduction under Section 80-O of the Act, viz. whether the deduction under Section 80-O of the Act is to be allowed on gross or on net basis. The contention of the Applicant-Assessee as evidenced from the statement of case was that the deduction should be allowed on gross basis i.e. dehors the provisions of Section 80AB of the Act. However, Tribunal in its order rendered for the earlier Assessment Year had held that there is no way of superseding the provisions of Section 80AB of the Act while computing the deduction allowable under Section 80-O of the Act. In fact, the question as framed has been referred to us by the Tribunal for the subject Assessment Year only for the reason that in the earlier Assessment Year it had referred the question to us for our opinion.....
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....e Act, but the issue is whether the income could be reduced by expenditure determined on prorata method on notional basis to restrict the claim for deduction. In support, learned Counsel invites our attention to the statement of case which records the fact that the Tribunal upheld the deduction under Section 80-O of the Act, after deducting corporate expenses in terms of Section 80AB of the Act. Mr. Lala, submits that the question as framed is not properly worded and, therefore, the Court must take note of the dispute as recorded in the orders of the Authorities under the Act. 12 In a Reference under Section 256(1) of the Act, our jurisdiction is Advisory. We are required to answer the question as referred to us in the context of the facts set out in the statement of case for our opinion. Therefore, on reading the statement of case, it is noted that it records that for the earlier Assessment Year, i.e. A. Y. 1982-83, adjustment of expenses should be limited only to the items that have nexus to the earning of the income and restored the issue to the Assessing Officer to determine the same. Notwithstanding the above findings/ directions, the Applicant-Assessee filed a Reference bein....