Law:

Section:

Section 80HHC of the Income-tax Act, 1961 - Deductions - Exporters - Assessment year 1996-97 - Assessee-firm claimed deduction under section 80HHC in respect of counter sales effected against convertible foreign exchange to foreigners, which did not involve clearance at customs - Whether such sales were to be treated as export out of India and, hence, eligible for benefit of section 80HHC - Held, yes FACTS The assessee-firm had a business of sale of semi-precious and precious stones, handicrafts, jewellery, etc. The assessee claimed a deduction under section 80HHC in its return of income. The Assessing Officer disallowed the deduction claimed by the assessee placing reliance upon Explanation (aa) to section 80HHC(4A) on the ground that sales effected by the assessee included counter sales. On appeal, the disallowance was confirmed by the Commissioner (Appeals). On second appeal the Tribunal allowed the claim relying upon the decision of the Allahabad High Court in the case of Ram Babu & Sons v. Union of India [1996] 222 ITR 606 and holding that since the counter sales were effected against convertible foreign exchange to foreigners which did not involve clearance at customs, these sales were export, out of India on which the assessee was entitled to the benefit under section 80HHC. The High Court dismissed the appeal preferred by the revenue holding that there was no merit in any of the contentions canvassed by the revenue and that the Tribunal had not committed any error of law either in following the decision in Ram Babu & Sons' case (supra) or in interpreting the provisions of Explanation (aa) to section 80HHC while extending the benefit of claim of deductions under section 80HHC in favour of the assessee on its counter sales to the foreigners. On appeal : HELD The transactions of counter sales effected by the respondent involved customs clearance within the meaning of Explanation (aa) to section 80HHC(4A) and further that the sales were in convertible foreign exchange. [Para 4] In the circumstances, it was to be held that the revenue having accepted and consistently followed the position of law settled by the case - Ram Babu & Sons case (supra )…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492