COMMISSIONER OF INCOME TAX Vs. HARISONS MALAYALAM LTD

JUDGEMENT

(1.) THE Income -tax Appellate Tribunal, Cochin Bench, has referred the following questions of law to this court under Section 256(1) of the Income -tax Act, 1961, for decision at the instance of the Revenue :

(2.) THE brief facts necessary for decision of this case are as follows : The respondent -assessee is a company in which the public are substantially interested. It has income from growing and manufacturing of tea besides trading activities. In the assessment for the year 1987 -88, the assessee claimed deduction under Section 80HHC of the Act to the extent of Rs. 16,27,562. The business income of the assessee is computed as follows :

(3.) ON the other hand, the contention of learned counsel for the assessee is that the profits of the business have been specifically stated to be computed under the head 'Profits and gains of the business', which take in only Sections 28 to 44D, and therefore, there is no scope for application of the provisions of Sections 70 to 72 of the Act. He also submitted that whether there is profit from the export business or not is immaterial, since Section 80HHC(3)(b) provides a particular formula for the computation of the profits derived from the export for the purpose of Section 80HHC(1). Counsel further submits that the formula is, Profits of the business x Export turnover Total turnover