Law:

Section:

Section 80HHC, read with section 263, of the Income-tax Act, 1961 - Deductions - Exporters - Assessment years 1991-92 and 1992-93 - Whether amount received from abroad against advertisements to be published in magazine cannot be treated as receipt against 'export of goods' nor is it covered by definition 'export turnover' as given under section 80HHC - Held, yes FACTS The assessee-firm was engaged in the business of publication of a journal. During the relevant assessment years, the assessee received subscription from abroad against the supply of said publication. The assessee also received substantial amount against the advertisement published in that publication. The assessee claimed the benefit of section 80HHC on the amount of subscription received from abroad against the magazine/ journal and also the amount received against advertisement given by foreigners for publication in that journal. The Assessing Officer allowed the benefit of section 80HHC on both the amounts. On scrutiny of the assessment orders for the relevant assessment years, the Commissioner found that the order of the Assessing Officer was erroneous and prejudicial to the interests of the revenue. Accordingly, the Commissioner directed the Assessing Officer to withdraw the benefit of section 80HHC given to the assessee on the amount received against advertisement which had been published in the journal. The Tribunal also upheld the view taken by the Commissioner on the ground that amount received against advertisement did not come under the definition of 'export turnover' as mentioned under section 80HHC. On reference : HELD In the various provisions of section 80HHC, in each sub-section, the words 'on export of goods and merchandise' have been used. The subscription against the advertisement cannot be treated as the receipt against the export of goods nor is it covered by the definition of 'export turnover' on which the benefit of section 80HHC can be computed. [Para 21] Accordingly, the Assessing Officer had gone wrong in allowing the deduction under section 80HHC on the amount received from abroad against the advertisement which had been given in journal published by the assessee. [Para…

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