COMMISSIONER OF INCOME TAX Vs. MACMILLAN INDIA LTD.

JUDGEMENT

(1.) RAISING the following substantial questions of law :

(2.) WHETHER the Tribunal is justified in the facts and circumstances of the case in directing relief under s. 32AB even in respect of interest income which is different from business income -

(3.) THE first question of law was decided in favour of the assessee and against the Revenue by this Court in CIT vs. Rathore Brothers (2002) 175 CTR (Mad) 60 : (2002) 254 ITR 656 (Mad), where the assessee had maintained separate accounts and maintained its trading receipts and P&L a/cs separately for export sales and domestic sales and produced sufficient material in support of all the necessary documents to show that the deduction claimed was entirely due to export, it was held that there was no warrant for disallowing any portion of the export earnings pro rata by invoking cl. (b) of sub -s. (3) of s. 80HHC of the IT Act, 1961, and the purpose of the clause was to disallow a part of the allowance under that section only when the entire deduction claimed could not be regarded as being relatable to exports.