ACIT CIR 21(2), MUMBAI v. SAHIL EXPORTS, MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E MUMBAI BEFORE SHRI R.S.SYAL AM AND SHRI VIJAY PAL RAO JM ITA NOS.1006 & 1007/MUM/2009 : ASST.YEARS 2002-200 3 & 2004-2005 THE ASSTT.COMMISSIONER OF INCOME-TAX CIRCLE 21(2) MUMBAI. VS. M/S.SAHIL EXPORTS 322A 3 RD FLOOR GOKUL ARCADE SWAMI NITYANAND MARG VILE PARLE (EAST) MUMBAI 400 057. PA NO.AADFS2767H. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SHRAVAN KUMAR RESPONDENT BY : SHRI R.N.VASANI O R D E R PER R.S.SYAL AM : THESE TWO APPEALS BY THE REVENUE ARISE OUT OF THE COMMON ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 26.11.2 008 IN RELATION TO THE ASSESSMENT YEARS 2002-2003 AND 2004-2005. SINCE BOT H THE APPEALS ARE BASED ON SIMILAR FACTS AND COMMON GROUNDS OF APPEAL WE ARE THEREFORE DISPOSING THEM BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE . ASSESSMENT YEAR 2002-2003 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST THE COMPUTATION OF DEDUCTION U/S.80HHC VIS--VIS DEPB. 3. BOTH THE PARTIES AGREE THAT THE THE FACTS AND CI RCUMSTANCES OF THIS APPEAL ARE SIMILAR TO THOSE DECIDED BY THE SPECIAL BENCH OF TH E TRIBUNAL IN THE CASE OF M/S.TOPMAN EXPORTS VS. ITO [(2009) 318 ITR (AT) 87 (MUMBAI) (SB)] . THE SPECIAL BENCH VIDE ITS ORDER DATED 11.08.2009 HAS RESTORED THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR CONSIDERING THE FACE VALU E OF DEPB AS COVERED UNDER SECTION 28 (IIIB) AND THE PROFIT ON TRANSFER OF DEP B I.E. EXCESS OF SALE PRICE OVER THE FACE VALUE OF DEPB AS FALLING UNDER SECTION 28 (IIID). IT HAS FURTHER BEEN HELD ITA NOS.1006 & 1007/MUM/2009 M/S.SAHIL EXPORTS. 2 THAT THERE IS NO SCOPE FOR ALLOWING SEPARATE DEDUCT ION FOR INDIVIDUAL EXPENSES CONNECTED WITH THE SALE OF DEPB DUE TO THE SCHEME O F SECTION 80HHC. WE THEREFORE SET ASIDE THE IMPUGNED ORDER ON THIS ISS UE AND DIRECT THE ASSESSING OFFICER TO RECOMPUTE THE DEDUCTION UNDER SECTION 80 HHC IN ACCORDANCE WITH THE VIEW TAKEN BY THE SPECIAL BENCH IN THE AFORE NOTED CASE. NEEDLESS TO SAY THE ASSESSEE WILL BE ALLOWED A REASONABLE OPPORTUNITY O F BEING HEARD BY THE AO IN THE FRESH PROCEEDINGS. ASSESSMENT YEAR 2004-2005 4. BOTH THE PARTIES ARE IN AGREEMENT THAT THE FACTS AND CIRCUMSTANCES OF THIS YEAR ARE MUTATIS MUTANDIS SIMILAR TO THOSE OF A.Y. 2002-2003. FOLLOWING THE VIEW TAKEN HEREINABOVE WE SET ASIDE THE IMPUGNED ORDER AND RE MIT THE MATTER TO THE FILE OF AO FOR DECIDING IT AFRESH IN ACCORDANCE WITH OUR OBSER VATIONS FOR THE EARLIER YEAR AS DISCUSSED ABOVE. 5. IN THE RESULT BOTH THE APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 21 ST DAY OF MAY 2010. SD/- SD/- ( VIJAY PAL RAO ) ( R.S.SYAL ) JUDICIAL MEMBER ACCOUNTANT M EMBER MUMBAI : 21 ST MAY 2010 . DEVDAS* ITA NOS.1006 & 1007/MUM/2009 M/S.SAHIL EXPORTS. 3 COPY TO : 1. THE APPELLANT. 2. THE RESPONDENTS. 3. THE CIT CONCERNED 4. THE CIT(A)-XXI MUMBAI. 5. THE DR/ITAT MUMBAI. 6. GUARD FILE. TRUE COPY. BY ORDER ASSISTANT REGISTRAR ITAT MUMBAI.