Vinay Khetan, v. ACIT Circle,

ITA 4689/DEL/2007 | 2001-2002
Pronouncement Date: 02-03-2010 | Result: Partly Allowed

Appeal Details

RSA Number 468920114 RSA 2007
Assessee PAN AACFU3533B
Bench Delhi
Appeal Number ITA 4689/DEL/2007
Duration Of Justice 2 year(s) 2 month(s) 30 day(s)
Appellant Vinay Khetan,
Respondent ACIT Circle,
Appeal Type Income Tax Appeal
Pronouncement Date 02-03-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted I
Tribunal Order Date 02-03-2010
Date Of Final Hearing 02-03-2010
Next Hearing Date 02-03-2010
Assessment Year 2001-2002
Appeal Filed On 03-12-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH I : NEW DELHI) SHRI G.E. VEERABHADRAPPA VICE PRESIDENT AND SHRI R.P. TOLANI JUDICIAL MEMBER ITA NOS.4689 & 4690/DEL./2007 (ASSESSMENT YEARS : 2001-02 & 2003-04) SHRI VINAY KHETAN VS. ACIT CIRCLE PROP. M/S. VRINDAVAN OVERSEAS NOIDA. A 41/42 NOIDA. (PAN : AACFU3533B) (APPELLANT) (RESPONDENT) ASSESSEE BY : S/SHRI K. SAMPATH & R.K. RAGHAVAN A DVOCATES REVENUE BY : MS. ANUSHA KHURANA DR ORDER PER R.P. TOLANI JUDICIAL MEMBER : THESE TWO APPEALS ARE FILED BY THE ASSESSEE. COMM ON GROUND IN BOTH THE APPEALS CHALLENGING FROM REOPENING OF ASSESSMEN T U/S 147 IS NOT PRESSED HENCE DISMISSED. ONE OF THE REMAINING COMMON GROUN DS IN BOTH THE APPEALS IS AS UNDER : WITHOUT PREJUDICE TO THE GROUND NO.1 ABOVE CHALLEN GING THE VALIDITY OF ASSESSMENT UNDER APPEAL THE LEARNED CI T (A) FURTHER ERRED IN UPHOLDING ILLEGAL ACTION OF A.O. I N ASSESSING THE ENTIRE SALE AMOUNT/RECEIPTS OF RS.1 62 92 000/- IN ITA NO.4689/DEL/2007 (RS.4 13 69 285/- IN ITA NO.4690/ DEL/ 2007) ON SALE OF DEPB LICENCE IN HIS HUNDRED PER CE NT EXPORT BUSINESS ON MISCONSTRUCTION OF THE PROVISIONS OF LA W ENACTED BY THE TAXATION LAWS (2 ND AMENDMENT) ACT 2005 IN SECTIONS 28(III) AND 80HHC OF THE ACT AS AGAINST PROFIT ONL Y ON SUCH SALE WITHOUT GIVING ANY RELIEF U/S 80HHC. ITA NOS.4689 & 4690/DEL./2007 2 2. LEARNED COUNSEL FOR THE ASSESSEE AT THE OUTSET C ONTENDS THAT THE ISSUE ABOUT DEPB CREDIT IS COVERED BY THE ITAT SPECIAL B ENCH JUDGMENT IN THE CASE OF TOPMAN EXPORTS 318 ITR (AT) 87 (SPECIAL BEN CH). TO DECIDE THIS ISSUE OF DEPB CREDIT IN CONFORMITY WITH THE ITAT S PECIAL BENCH ORDER THE ISSUE NEEDS TO BE RE-DECIDED BY A.O. 3. THE ONLY REMAINING GROUND IN ASSESSMENT YEAR 200 3-04 IS AS UNDER : THE LEARNED CIT (A) ALSO ERRED IN CONFIRMING ACTI ON OF A.O. IN ASSESSING INTEREST INCOME OF RS.47 545/- AS INCOME FOR OTHER SOURCE BY CALCULATING SUCH INTEREST AT ARBITR ARY RATE OF 8% ON FDRS OF RS.5 94 314/- REJECTING THE PLEA OF THE APPELLANT THAT WHATEVER INCOME FROM BANK FDR WAS EARNED WAS TO BE NETTED AGAINST PAYMENT OF INTEREST IN EXPORT BUSINESS OF T HE APPELLANT. 4. IT IS PLEADED THAT THE ISSUE ABOUT CONSIDERATION OF BANK INTEREST HAVING NEXUS WITH THE EXPORT BUSINESS OF THE ASSESSEE HAS TO GO TO A.O. FOR THE PURPOSE OF NETTING AND ACCORDINGLY CONSIDERING FOR WORKING OF DEDUCTION U/S 80HHC. 5. LEARNED DR WAS HEARD ON BOTH THE ISSUES. 6. WE HAVE HEARD THE PARTIES AND HAVE PERUSED THE M ATERIAL ON RECORD. THE ISSUE ABOUT DEPB CREDIT FOR THE PURPOSE OF SECT ION 80HHC CALCULATION HAS TO GO BACK TO A.O. FOR FRESH CONSIDERATION IN C ONFORMITY WITH SPECIAL BENCH JUDGMENT IN THE CASE OF TOPMAN EXPORTS (SUPRA ). SIMILARLY THE ISSUE ITA NOS.4689 & 4690/DEL./2007 3 ABOUT FDR INTEREST TO BE ADOPTED FOR NETTING PURPOS ES AND CALCULATION OF DEDUCTION U/S 80HHC HAS TO GO BACK TO A.O. 7. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 2 ND DAY OF MARCH 2010. SD/- SD/- (G.E. VEERABHADRAPPA) (R.P. TOLANI) VICE PRESIDENT JUDICIAL MEMBER DATED THE 2 ND DAY OF MARCH 2010 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A) GHAZIABAD. 5.CIT(ITAT) NEW DELHI. AR ITAT NEW DELHI.