The Commissioner of Income-tax, Thiruvananthapuram v. Olam Exports (India) Ltd
[Citation -2017-LL-0803-17]
| Citation | 2017-LL-0803-17 |
|---|---|
| Appellant Name | The Commissioner of Income-tax, Thiruvananthapuram |
| Respondent Name | Olam Exports (India) Ltd. |
| Court | HIGH COURT OF KERALA AT ERNAKULAM |
| Relevant Act | Income-tax |
| Date of Order | 03/08/2017 |
| Assessment Year | 2000-01 |
| Judgment | View Judgment |
| Keyword Tags | profit and loss account • liability written back • business expenditure • admissibility of deduction • export business • income from other source |
| Bot Summary: | While completing the assessment, the assessee was allowed deductions under Section 80HHC amounting to Rs.85,47,974/- and subsequently the Assessing Officer found that in computing deductions under Section 80HHC, 90 of Miscellaneous receipts of Rs.33,45,844/-, Written back of provisions/credits of Rs.60,646/- and Liabilities written back of Rs.28,84,535/-, were omitted to be deducted from the business income for the purpose of arriving at the profits of the business. Accordingly, rectification under Section 154 of the Income Tax Act was effected by Annexure-A ITA 165/2012 2 proceedings and deduction under Section 80HHC was re- quantified at Rs.36,53,949/-. The assessee filed an appeal and by Annexure-B order, the Commissioner of Income Tax held that the Assessing Officer was not justified in excluding 90 of the provision and liability written back, amounting to Rs.60,646/- and Rs.28,84,535/-, for the purpose of computing the deduction under Section 80HHC. The Revenue filed appeal before the Tribunal and the Tribunal upheld the order of the Commissioner. 80HHC including 90 of the written back provisions and liabilities written back as business income and not as income from other sources. Whether on the facts and in the circumstances of the case the liabilities and provisions written back which have no direct nexus with the business profits of the current year is not to be excluded from the profit of the business in accordance with clause of explanation to section 80HHC ITA 165/2012 3 3.Whether on the facts and in the circumstances of the case the Commissioner of Income Tax and the Tribunal are right and with jurisdiction in considering the issue of rectification on merits 2. It is on this basis that the Revenue contends that the written back provision of Rs.60,646/- and liabilities written back of Rs.28,84,535/- do not qualify for deduction. On materials we find that, as rightly found by the Tribunal, the credits aggregating to Rs.29.45 lakhs, represents the write back of expenditure debited to the profit and loss account for an earlier year/years claimed as business expenditure, and written back on being found as having been provided for in excess, i.e. to that extent. |