COMMISSIONER OF INCOME TAX Vs. RITESH INDUSTRIES LIMITED

JUDGEMENT

(1.) The present appeal under Section 260 A of the Income Tax Act, 1961 (hereinafter referred as the Act) is preferred by the Revenue raising the following question:- Whether the amount of "duty draw back" can be regarded as income derived from an industrial undertaking so as to entitle the assessee a deduction under section 80-I of the Income Tax Act, 1961?

(2.) In this matter one need not go into the facts as it is an admitted position that the assessee who is a manufacturer, has received "duty draw back" in view of the export of garments. The question is whether the amount of "duty draw back" which the assessee has received can be considered to be "profits and gains derived from an industrial undertaking" in the context of Section 80-I of the Act. Sub-section (1) of Section 80-I of the Act, is relevant for our purpose and, therefore, we reproduce it below:-

(3.) As aforesaid, we are required to consider whether the expression "profits and gains derived from an industrial undertaking" would include the duty draw back or not. In case of Commissioner of Income Tax v. Jameel Leathers and Uppers :(2000) 246 ITR 97 a Division Bench of the Madras High Court had an occasion to consider the similar provisions contained in Section 80-HH as well as in Section 80-J of the Act. The question raised in that case was as under :-