Nissan Export v. Commissioner of Income-tax
[Citation -2013-LL-0715-50]

Citation 2013-LL-0715-50
Appellant Name Nissan Export
Respondent Name Commissioner of Income-tax
Court SUPREME COURT
Relevant Act Income-tax
Date of Order 15/07/2013
Judgment View Judgment
Keyword Tags deduction under section 80hhc • export incentive • export turnover
Bot Summary: JUDGMENT Order Mr. Gourab Banerji, learned Additional Solicitor General for the Revenue, fairly submits that in view of the decision of this court in Topman Exports v. CIT 2012 342 ITR 49, these civil appeals deserve to be allowed and the matters need to be sent back to the Assessing Officer. In Topman Exports this court concluded as follows: The aforesaid discussion would show that where an assessee has an export turnover exceeding Rs. 10 crores and has made profits on transfer of DEPB under clause of section 28, he would not get the benefit of addition to export profits under third or fourth proviso to sub-section of section 80HHC, but he would get the benefit of exclusion of a smaller figure from'profits of the business' under Explanation to section 80HHC of the Act and there is nothing in Explanation to section 80HHC to show that this benefit of exclusion of a smaller figure from'profits of the business' will not be available to an assessee having an export turnover exceeding Rs. 10 crores. In other words, where the export turnover of an assessee exceeds Rs. 10 crores, he does not get the benefit of addition of ninety per cent. Of export incentive under clause of section 28 to his export profits, but he gets a higher figure of profits of the business, which ultimately results in computation of a bigger export profit. The impugned judgment and orders of the Bombay High Court are accordingly set aside. The appeals are allowed to the extent indicated in this judgment. The Assessing Officer is directed to compute the deduction under section 80HHC in the case of the appellants in accordance with this judgment... For the same reasons, the impugned judgment and order of the Gujarat High Court is set aside and the Assessing Officer is directed to compute the deduction under section 80HHC of the Income-tax Act, 1961, in the light of the observations made by this court in Topman Exports as noted above.


JUDGMENT Order Mr. Gourab Banerji, learned Additional Solicitor General for Revenue, fairly submits that in view of decision of this court in Topman Exports v. CIT [2012] 342 ITR 49 (SC), these civil appeals deserve to be allowed and matters need to be sent back to Assessing Officer. In Topman Exports this court concluded as follows (page 67): "The aforesaid discussion would show that where assessee has export turnover exceeding Rs. 10 crores and has made profits on transfer of DEPB under clause (d) of section 28, he would not get benefit of addition to export profits under third or fourth proviso to sub-section (3) of section 80HHC, but he would get benefit of exclusion of smaller figure from'profits of business' under Explanation (baa) to section 80HHC of Act and there is nothing in Explanation (baa) to section 80HHC to show that this benefit of exclusion of smaller figure from'profits of business' will not be available to assessee having export turnover exceeding Rs. 10 crores. In other words, where export turnover of assessee exceeds Rs. 10 crores, he does not get benefit of addition of ninety per cent. of export incentive under clause (iiid) of section 28 to his export profits, but he gets higher figure of profits of business, which ultimately results in computation of bigger export profit. High Court, therefore, was not right in coming to conclusion that as assessee did not have export turnover exceeding Rs. 10 crores and as assessee did not fulfil conditions set out in third proviso to section 80HHC(iii), assessee was not entitled to deduction under section 80HHC on amount received on transfer of DEPB and with view to get over this difficulty assessee was contending that profits on transfer of DEPB under section 28(iiid) would not include face value of DEPB. It is well-settled principle of statutory interpretation of taxing statute that subject will be liable to tax and will be entitled to exemption from tax according to strict language of taxing statute and if as per words used in Explanation (baa) to section 80HHC read with words used in clauses (iiid) and (iiie) of section 28, assessee was entitled to deduction under section 80HHC on export profits, benefit of such deduction cannot be denied to assessee. impugned judgment and orders of Bombay High Court are accordingly set aside. appeals are allowed to extent indicated in this judgment. Assessing Officer is directed to compute deduction under section 80HHC in case of appellants in accordance with this judgment..." For same reasons, impugned judgment and order of Gujarat High Court is set aside and Assessing Officer is directed to compute deduction under section 80HHC of Income-tax Act, 1961, in light of observations made by this court in Topman Exports as noted above. Civil appeals are allowed as above with no order as to costs. *** Nissan Export v. Commissioner of Income-tax
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