2026 (9) TMI 388

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.... Act, 1961 arising from the order of the Income Tax Appellate Tribunal, Delhi Bench : 'F' New Delhi dated 18.06.2010 in I.T.A. No. 3921/Del/09 for the A.Y. 2002-03. Thereby, the Tribunal has dismissed the assessee appeal. 3. Present appeal was admitted on the following questions of law:- "2. Whether the deduction claim under Section 80IB of Rs. 7,46,006/- is to be reduced from the profit from business of Rs. 29,84,874/ as from qualified amounts of deduction under Section 8HHC of Rs. 19,07,138/-. 6. Whether the ITAT was justified in holding that Section 80IA(9) of Act mandates that the amount of profits allowed as deduction u/s. 80IA(1) of Act has to be reduced from the profit of business of industrial undertakin....

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....ts of business as reduced by the amounts specified in clause (baa) and sub-section (4-B) of Section 80-HHC but by also reducing the amount of profit and gains allowed as a deduction under Section 80-IA(1) of the Act. In other words, the gross total income eligible for deduction under Section 80-HHC would be less or reduced by the deduction already allowed under Section 80-IA . Thus, the gross total income eligible for deduction would not be the gross total income as defined in sub- section (5) of Section 80-B read with Section 80-B, but would be the gross total income computed under sub-section (5) of Section 80-B read with Section 80-AB less the deduction under Section 80-IA. An example will make the position clear. Supposing an assessee h....

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....a stage prior and helps in quantifying the amount, which is eligible for deduction. Sub-section (9) of Section 80-IA does not bar or prohibit the deduction allowed under Section 80-IA from being included in the gross total income, when deduction under Section 80-HHC(3) of the Act is computed. In this context it has been held that the expression "shall not be allowed" cannot be equated with the words "shall not qualify" or "shall not be allowed in computing deduction". The effect thereof would be that while computing deduction under Section 80-HHC, the gross total income would mean the gross total income before allowing any deduction under Section 80-IA or other sections of Part C of Chapter VI-A of the Act. But once the deduction under Sect....