SEVEN STARS Vs. DEPUTY COMMISSIONER OF INCOME

JUDGEMENT

(1.) The Appellant carried on business of exports of cut and polished diamonds. The Appellant, apart from the work of cutting and polishing diamonds, also undertook work of other exporters on contract basis. By the Assessment Year 1991-92, period relevant for this appeal, the Appellant received an amount of Rs.10,67,350/- which was credited by the Appellant under the head "Reassortment Charges". The Appellant also received an amount of Rs.1,48,909/- as "Labour Commission Charges" since the Appellant had given a work of cutting and polishing diamonds on sub-contracts.

(2.) The Appellant filed the return of income on 7 October 1991 declaring income of Rs.1,57,660/- after claiming deduction of Rs.30,43,279/- under Section 80 HHC of the Income Tax Act, 1961. The Assessing Officer by order dated 28 August 1992 excluded the amount of Reassortment Charges and Labour Commission Charges. Having restricted the deduction under Section 80 HHC to Rs.19,96,710/-, the Assessing Officer passed the order on 28 August 1992.

(3.) The Appellant filed an appeal with the Commissioner of Income Tax (Appeals), which was allowed in favour of the Appellant by order dated 22 June 1994. The Respondent-Revenue filed Income Tax Appeal bearing No.4971/Bom/94 before the Income Tax Appellate Tribunal and the Tribunal allowed the Appeal of the Revenue by order dated 6 May 2002. Hence, the present Appeal is filed by the Appellant-Assesssee.