COMMISSIONER OF INCOME TAX Vs. HARIG INDIA LIMITED

JUDGEMENT

(1.) The present appeal by the Revenue under Section 260A of the Income Tax Act, 1961 (Act, for short) was admitted for hearing on 20th July, 2006, on the following substantial question of law:

(2.) The appeal relates to the assessment year 1998-99 and impugns the findings recorded against the Revenue by the Income Tax Appellate Tribunal (Tribunal, for short) in their order dated 5th November, 2001. The respondent assessee a public limited company, as per the finding recorded in the impugned order was engaged for the past 35 years in the business of manufacture and sale of hydraulics/machine tools, parts, components and assemblies. The appellant had also started export of jewellery.

(3.) In the return for assessment year 1998-99, the assessee had claimed deduction under Section 88HHC of the Act, on exports of hydraulic power lift system and gold jewellery. For computation of deduction under the said Section, the assessee had invoked and applied sub-section (3)(a) to Section 80 HHC claiming that it was a manufacturer of the exported goods including jewellery. The assessee had computed deduction at Rs.68,58,239/- by applying clause (a) to sub-section (3) to Section 80HHC.