Commissioner Of Income Tax, Delhi ... vs M/S.Purolator India Limited
2011 Latest Caselaw 1640 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

+                          I.T.A. No.537/2007


%                    Date of Decision: 22.03.2011

Commissioner of Income Tax, Delhi - V              .... Appellant
                   Through: Ms. Rashmi Chopra, Advocate for the
                             Revenue.

                                Versus

M/s.Purolator India Limited                         .... Respondent
                      Through: Mr.Amit Sachdeva, Advocate


CORAM:
HON'BLE MR. JUSTICE A.K. SIKRI
HON'BLE MR. JUSTICE M.L. MEHTA

1.   Whether reporters of Local papers may be                   No
     allowed to see the judgment?
2.   To be referred to the reporter or not?                     No
3.   Whether the judgment should be reported in                 No
     the Digest?


A.K. SIKRI, J. (ORAL)

*

1. This appeal involves the following questions of law:-

"(a) Whether on a correct interpretation of the relevant statutory provisions, Tribunal was justified in law in directing the Assessing Officer to allow deduction under section 80HHC of the Act in respect of "profit" on sale of DEPB?

(b)Whether on the facts of the present case, Tribunal was justified in law in impliedly holding that the assessee would be entitled to deduction as per the first proviso below sub-Section 3 of Section

80HHC in respect of DEPB Credit utilized by the assessee?"

2. The order passed by the Tribunal in this appeal is brief because

of the reason that the Tribunal has simply followed (which it was

supposed to) the decision of the ITAT Special Bench, Mumbai in the

case of Topman Export Vs. ITO [ITA No. 5769/Mum./2006 decided on

dated 11th August, 2009.]. By that judgment, the Special Bench of the

Tribunal has held that the face value of DEPB is chargeable to tax u/s

28 (iiib) at the time of accrual of income, that is, when the application

for DEPB is filed with the competent authority pursuant to exports and

profit in sale of DEPB representing the excess of sale proceeds of DEPB

over its face value is liable to be considered u/s 28(iiid) at the time of

its sale.

3. The Revenue had filed the appeal in the High Court Adjudicate at

Bombay against the aforesaid decision of the Special Bench of the

ITAT. The Bombay High Court has reversed the decision of the Tribunal

and the judgment of the Bombay High Court is reported as

Commissioner of Income Tax Vs. Kalpataru Colours and

Chemicals, 328 ITR 451.

4. Since the Tribunal had simply followed Special Bench decision in

Topman Exports (supra) which stands over ruled, we set aside the

order passed by the Tribunal and remit the case back to the Tribunal to

decide this appeals on merits after taking into account factual position

in all this case.

5. The appeal stands disposed of on above terms.

A.K. SIKRI, J.

M.L.MEHTA, J.

MARCH 22, 2011 Dev