TaxTMI 
TaxTMI 
TaxTMI 
2011 (2) TMI 1586
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....assessing officer did not allow deduction u/s 80IA in respect of the following items: (i) Sale of import licence ₹ 2,44,14,467 (ii) Duty draw back ₹ 1,52,189 (iii) DEPB licence sale ₹ 9,08,234 The CIT(A) confirmed the order of the assessing officer. The assessee carried the matter before the ITAT and the ITAT vide order dated 18-10-2007 restored the issue back to the file of the assessing officer with the following directions: "We have considered the rival contentions and find some force in the arguments of the ld.A.R. for the aswsessee with reference to the income arose on export incentives. As the Assessing Officer has not deliberated upon the extended benefit given under section 80IA as relied upon by the L....
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....proceedings is restricted within the directions issued by the Tribunal. The assessing officer under no circumstances can deviate from the direction issued by the Tribunal. The ld.AR in support of this contention has relied upon the judgment of Allahabad High Court in the case of SP Kochhar vs ITO 145 ITR 255 (All). It is further submitted that in the present case the ITAT directed to decide the issue afresh in view of the judgment of the co-ordinate bench of the Tribunal in the case of ACIT vs Maxcare Laboratories Ltd 273 ITR 1. Therefore, the limited jurisdiction available to the assessing officer in set aside proceedings was to decide the claim of the assessee for deduction u/s 80IA on income including the income in the nature of export i....
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....w back. Both items are insignificant. Therefore, the judgment of Supreme Court is not relevant. 7. The ld.DR, on the other hand, relied upon the order of the CIT(A) and submitted that now the issue is covered in favour of the revenue by the judgment of the Apex Court in the case of Liberty India Ltd vs CIT 317 ITR 218 (SC). The ld.DR submitted that in the light of that the order of CIT(A) may be confirmed. 8. We have heard the learned representatives of the parties, perused the record and gone through the judgments cited. This is the second round of proceedings before the Tribunal. In the first round of litigation, the ITAT vide order dated 18-10-2007 in ITA No.598/RJT/2003 had restored the issue to the file of the assessing officer with ....
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....al in the case of ACIT vs Maxcare Laboratories Ltd (2005) 92 TTJ 179, the assessing officer found that the decision rendered by the Tribunal in that case pertained to interest on deposits made under business compulsion and therefore it was held to be qualified for deduction u/s 80IA and further netting off was also required with the interest expenditure. In this view of the matter the assessing officer denied the claim of deduction u/s 80IA to the assessee in respect of sale of import licence, duty drawback and DEPB licence sale incomes. The ld.CIT(A) upheld the action of the assessing officer. 9. Another development has taken place on the issue under consideration inasmuch as that a judgment of the Apex Court in the case of Liberty India ....
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....ntive. It is given under Duty Exemption Remission Scheme. Essentially, it is an export incentive. No doubt, the object behind DEPB is to neutralize the incidence of customs duty payment on the import content of export product. This neutralization is provided for by credit to customs duty against export product. Under DEPB, an exporter may apply for credit as percentage of FOB value of exports made in freely convertible currency. Credit is available only against the export produce and at rates specified by DGFT for import of raw materials, components etc. DEPB credit under the Scheme has to be calculated by taking into account the deemed import content of the export product as per basic customs duty and special additional duty payable on suc....
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....rofits derived from eligible profit. Therefore, duty draw back / DEPB / other export incentives are incentives flowing from the scheme framed by the Government in the Customs Act and others; hence incentive profits are not derived from the eligible business and therefore, these benefits do not form part of net profit of the industrial undertaking for the purpose of section 80IA / 80IB of the Act. There is a law laid down by the highest court of the land, which is binding on all courts, Tribunals and all authorities in view of Article 141 of the constitution and it is not open to distinguish the same by referring to certain words of those provisions which were very much before the Supreme Court, merely on the ground that some other arguments....