Commissioner of Income-tax v. Kanel Oil and Export Industries Ltd
[Citation -2014-LL-1205-84]
| Citation | 2014-LL-1205-84 |
|---|---|
| Appellant Name | Commissioner of Income-tax |
| Respondent Name | Kanel Oil and Export Industries Ltd. |
| Court | HIGH COURT OF GUJARAT AT AHMEDABAD |
| Relevant Act | Income-tax |
| Date of Order | 05/12/2014 |
| Assessment Year | 1996-97 |
| Judgment | View Judgment |
| Keyword Tags | profits and gains of business or profession • business of manufacturing and sale • earning interest income • rent • depb |
| Bot Summary: | The assessee firm is engaged in the business of manufacturing and sale of castor oil in tehlocal as well as export markets. During the course of assessment proceedings, the assessing officer noticed that the assessee had claimed deduction u/s 80IA of I.T Act in respect of purchase, sale and resale of castor seeds and castor oil. The Assessing Officer rejected the claim of the assessee for deduction u/s 80IA treating it as other income. On appeal before the Tribunal, by impugned order, the Tribunal reversed the order of CIT(A) and directed the Assessing Officer to exclude the net interest income. The issue involved in the present Tax Appeal is now not res integra in view of the decision of the Honble Supreme Court in the case of ACG Associated Capsules Pvt. Ltd. vs. CIT reported in 2012 343 ITR 89 wherein the Hon ble Supreme Court has held that for the purpose of Section 80HHC of the Income Tax Act, 1961 it is not the entire amount received by the assessee on sale of DEPB credit but the sale value less the face value of the DEPB that will represent profit on transfer of DEPB credit by the assessee. Having heard learned advocates appearing on behalf of the parties and the question posed for consideration before us reproduced hereinabove and considering the decision of the Hon ble Supreme Court in the case of ACG Associated Capsules Pvt. Ltd, the question which is raised in the present appeal is required to be answered in favour of the assessee. We are not giving any elaborate reasons for the same as in the case of ACG Associated Capsules Pvt. Ltd it is held by the Hon ble Supreme Court that ninety percent of not the gross rent or gross interest but only the net interest or net rent which had been included in the profits of business of the assessee as computed under the head Profits and gains of business or profession was to be deducted under clause of Explanation to section 80HHC for determining the profits of the business. |