Law:

Section:

Section 80HHC of the Income-tax Act, 1961 - Deductions - Exporters - Assesssee exporter claimed deduction under section 80HHC in respect of (i) interest paid on export packing credit limit; (ii) interest paid on term loan obtained for setting up of project and; (iii) depreciation calculated on computer installed - Tribunal held that amount spent/used by assessee could be regarded as direct cost and could be included in cost of manufactured goods for purpose of claiming deduction under section 80HHC - Whether a question as to whether a particular amount satisfies definition of 'direct costs' or 'indirect costs' as given in Explanations (d) and (e) of section 80HHC, is a question which needs to be decided on facts and material brought on record by assessee, before it is finally held that deduction under section 80HHC is available to assessee - Held, yes - Whether since Tribunal had not examined issue keeping in view requirement of Explanations (d) and (e) appended to section 80HHC and returned finding in assessee's favour, case should be remanded to Tribunal for deciding appeal afresh - Held, yes R.L. Jain and Ku. V. Mandlik for the Appellant. G.M. Chafekar and Sarda for the Respondent. ORDER Sapre, J. - This is an appeal filed by Revenue (Commissioner of Income Tax) under section 260A of the Income Tax Act against an order dated 19-9-2000, passed by ITAT (for brevity hereinafter referred to as Tribunal) in ITA No. 203/Ind./2000. This appeal was admitted for final hearing on following substantial question of law:- "Whether on the facts and on the circumstances of the case and in law the ITAT was required to direct the Assessing Officer to work out the direct cost of the finished goods of exported items vide paras 9 and 11 of their order when in fact what is required to workout the deduction under section 80HHC was the direct cost of the Trading Goods exported vide Clause (d) of explanation below section 80HHC(3) of the Income Tax Act and when no inference could be drawn in respect of the direct cost of the Trading Goods exported in view of the assessee's export sources their in being their purchase of goods from the Market and/or manufactured in their own…

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