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Section 80-IB of the Income-tax Act, 1961 - Deductions - Profits and gains from Industrial undertakings other than infrastructure development undertakings - Whether interest on deposits would be allowable as deduction under section 80-IB - Held, no Section 80HHC of the Income-tax Act, 1961 - Deductions - Exporters - Assessment year 2003-04 - Whether 90 per cent of receipts from freight and insurance, packing charges, sales tax set off and gross service income are to be excluded from profits of business in terms of Explanation (baa) to section 80HHC as there is no direct nexus between source of these receipts and export business - Held, yes EDITOR'S NOTES Issue relating to miscellaneous income was to be remanded back to the Tribunal for fresh consideration, in the light of the of the Supreme Court in Liberty India v. CIT [2009] 317 ITR 218/ 183 Taxman 349. CASE REVIEW CIT v. Dresser Rand India (P.) Ltd. [2010] 323 ITR 429 / 191 Taxman 339 (Bom.) and Liberty India v. CIT [2009] 317 ITR 218/ 183 Taxman 349 (SC) (para 2) followed. CASES REFERRED TO CIT v. Dresser Rand India (P.) Ltd. [2010] 323 ITR 429 / 191 Taxman 339 (Bom.) (para 2) and Liberty India v. CIT [2009] 317 ITR 218 / 183 Taxman 349 (SC) (para 2). F.V. Irani and A.K. Jasani for the Appellant. Suresh Kumar for the Respondent. JUDGMENT 1. The appeal by the Revenue under section 260A of the Income-tax Act, 1961 arises out of an order of the Income-tax Appellate Tribunal dated April 23, 2009 in relation to the assessment year 2003-04. The appeal is admitted on the following two questions : "(i)Whether on the facts and in the circumstances of the case, the Hon'ble Income-tax Appellate Tribunal is correct in holding that receipts from 'interest on deposits' and 'miscellaneous income (reversal of LD charges)' are derived from the business of industrial undertaking and therefore are eligible for claim of deduction under section 80-IB, despite there being no direct nexus between source of these receipts and business of industrial undertaking ? (ii)Whether on the facts and in the circumstances of the case, the Hon'ble Income-tax Appellate Tribunal is right in holding that 90 per cent of receipts from freight and…

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