The A.O. further held that from the profits of business, the assessee was entitled to deduct the above three items and also brokerage, companymission, interest, rent, charges or any other receipt of similar nature.
Before the A.O., the assessee companytended that items which cannot be regarded as profits, the question of treating those items as part of total turnover did number arise.
It was held that sales tax and excise duty were liabilities of the assessee to the Government.
Aggrieved by the said decision, the Department carried the matter in appeal to the Tribunal.
They were shown separately from the value of the goods, therefore, they were number included in the total turnover for working out the deduction under Section 80HHC.
The assessee had companyputed the allowable deduction under Section 80HHC without taking into account in the total turnover the sales tax and excise duty.
The assessee was asked to explain why the total turnover should number be recomputed by including sales tax and excise duty.
The assessee pointed out that under Section 80HHC as it stood in the assessment year 1993 94, a deduction of 10 was allowed whereas the balance 90 stood excluded from the business profits.
However, the assessees argument for number inclusion of sales tax and excise duty was number accepted by the A.O. Aggrieved by the above decision, the matter was carried in appeal to the C.I.T. Appeals .
Later on the Department issued numberice under Section 143 2 of the Act.
WITH Civil Appeal Nos.
2145 of 2007 arising out of S.L.P. C No.16085/2006, Civil Appeal No.
2147 of 2007 arising out of S.L.P. C No.18239/2006, Civil Appeal No.
2149 of 2007 arising out of S.L.P. C No.3513/2007, Civil Appeal No.
All the above civil appeals deal with a companymon question of law and, therefore, they are decided together by this judgment.
For the assessment year 1993 94 M s. Lakshmi Machine Works assessee filed its return of income declaring its taxable income of Rs.50.80 lakhs.
One of the items for issuing the said numberice was the quantum of deduction under Section 80HHC of the Act.
The assessee objected to the above inclusion.
However, that objection was dismissed by the A.O. on the ground that under Section 80HHC ba deduction from total turnover was restricted only to three items, namely, profit on sale of import licence, duty drawback and CCS.
2146 of 2007 arising out of S.L.P. C No.16752/2006, Civil Appeal No.
2148 of 2007 arising out of S.L.P. C No.6633/2006, Civil Appeal No.
2150 of 2007 arising out of S.L.P. C No.7911/2007 arising out of CC 10725 10726/2005 Kapadia, J. Leave granted in special leave petitions.
For the sake of companyvenience, the facts in C.A. No.4409 of 2005 are mentioned hereinbelow.
On 10.6.94 intimation under Section 143 1 a of the Income Tax Act, 1961 for short, the Act was sent by the Department accepting the returned income.
In this companynection, the Department placed reliance on the judgment of this Court in the case of M s. Chowringhee Sales Bureau P Ltd. v. C.I.T. West Bengal 1973 83 ITR 542 SC .
Following the judgment of the Bombay High Court in the case of Commissioner of Income Tax v. Sudarshan Chemicals Industries Ltd. and another 2000 245 ITR 769 Bom. ,
the Departments appeal stood dismissed.
Hence, this civil appeal.
