COMMISSIONER OF INCOME TAX Vs. FIVE STAR RUGS

JUDGEMENT

(1.) WHETHER on the facts and in the circumstances of the case, the Hon'ble Tribunal was right in law in sustaining the order of the CIT(A) directing the AO to allow deduction under s. 80 -IB on the amount of duty drawback received by the assessee which cannot be termed as income 'derived from' an industrial undertaking as held by the Hon'ble Supreme Court of India in the case of CIT vs. Sterling Foods (1999) 153 CTR (SC) 439 : (1999) 237 ITR 579 (SC) followed by the Hon'ble Madras High Court in the cases of CIT vs. Jameel Leathers & Uppers (2000) 246 ITR 97 (Mad) and CIT vs. Vishwanathan & Co. (2003) 181 CTR (Mad) 335 : (2003) 261 ITR 737 (Mad) and the Hon'ble Delhi High Court in the case of CIT vs. Ritesh Industries Ltd. (2004) 192 CTR (Del) 81 : (2005) 274 ITR 324 (Del) and also by the Hon'ble Tribunal SMC Bench in the case of Asstt. CIT vs. Liberty India, Panipat, for the asst. yr. 2001 -02 vide order dt. 28th

(2.) IN spite of service, none appears for the assessee.

(3.) WE have heard learned counsel for the Revenue. IT Appeal No. 590 of 2005 [reported at (2007) 207 CTR (P&H) 243 - -Ed.], wherein, the question raised was examined and it was held that the amount of duty drawback received by the assessee could not be treated as income "derived from" an industrial undertaking. Relevant observations in Liberty India's case (supra) are as under :