Law:

Section:

Section 80HHC of the Income-tax Act, 1961 - Deduction - Exporters Where assessee-exporter was maintaining separate set of books of account for export sales and domestic sales, assessee was entitled for deduction under section 80HHC fully on export profit and deduction could not be on basis of total turnover of all business The Assessing Officer, after going through the facts that the assessee, while computing the deduction under section 80HHC, had taken into consideration only the turnover of the export division for the purpose of total turnover, calculated composite turnover or both the export turnover as well as domestic turnover and accordingly recomputed the deduction under section 80HHC. The Tribunal, however, held that the assessee was entitled to deduction under section 80HHC fully on export profits. Held that as the Tribunal had categorically stated that the assessee exporter was maintaining separate sets of books of account for export sales and domestic sales, the assessee was entitled for deduction under section 80HHC fully on the export profit. J. Naresh Kumar for the Appellant. JUDGMENT K. Raviraja Pandian, J.-This appeal has been filed against the order of the Income-tax Appellate Tribunal in I.T.A. No. 942/Mds/2005 dated November 30, 2006. The relevant assessment year is 2001-02. The assessee is a manufacturer of garments and fancy items and exporter. The assessee filed its return of income on October 29, 2001, for the relevant assessment year 2001-02 claiming deduction under section 80HHC of the Income-tax Act, 1961 (hereinafter referred to as "the Act") on export turnover ignoring the results of the domestic turnover. The Assessing Officer after going through the facts that the assessee while computing the deduction under section 80HHC of the Act has taken into consideration only the turnover of the export division for the purpose of total turnover, has made a composite turnover of both the export turnover as well as domestic turnover and accordingly recomputed the deduction under section 80HHC of the Act. Aggrieved by that order, the assessee preferred an appeal before the Commissioner of Income-tax (Appeals) and the Commissioner of Income-tax…

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