ROLLATAINERS LTD. Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) This is an assessee's appeal under Section 260A of the Income Tax Act, 1961 ("the Act") against the consolidated order of the Income Tax Appellate Tribunal ("ITAT") (Delhi Bench) dated 30.07.2003. The following questions of law were framed for consideration, at the time of admission of the appeal:

(2.) The assessee is engaged in the business of manufacturing packaging cartons and packaging machinery. It carries out its activities under the following divisions:

(3.) During the relevant assessment years i.e. 1994-95, the assessee exported cartons from the packaging division, packaging machines and bought out components from the Machine Trading division. In addition to exports, these divisions also had local sales. The assessee in its return of income for the assessment years 1994-95 claimed deduction under Section 80HHC of the Act for Rs. 48,75,358. It claimed deduction under Section 80HHC(3)(a) of the Act on division-wise basis, i.e. by taking the total profit of each division which had made exports and thereafter computing the deduction in the same ratio as export turnover of the division bore to the total turnover of that division. The profits and turnover derived from other divisions were not considered while computing deduction under Section 80HHC for a particular division. The Assessing Officer (AO), while framing the assessment order clubbed the profits and turnover of all the divisions and allowed deduction under Section 80HHC of the Act by considering the various divisions of the assessee as one business.