IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1392 OF 2008 M/s.Narangs Hotels & Resorts P.Ltd., ) Now Narangs International Hotels P.Ltd)..Appellant Vs Dy.Commissioner of Income-tax ) Central Circle-36(3) Mumbai )..Respondent ---- Ms.Beena Pillai i/by D.M.Harish & Co. for the appellant. Mr.D.A.Athawale for the respondent. ---- Coram : F.I.Rebello & R.S.Mohite,JJ Date : 5.3.2009. PC 1. The substantial questions of law as framed in this appeal are as follows :- (I) Whether the tribunal erred in rejecting the claim of the assessee for a deduction u/s 80 HHC of the I.T.Act to the extent of profits derived by the Assessee from the export of good ? (II) Whether on facts and circumstances of the case and in the law in the Tribunal erred in not following the Order dated 29.1.2002 of the Hon’ble ITAT, Mumbai "B" Bench in the case of India Hotels Co.Ltd., for A.Y.1989-90 wherein the facts are identical and the Hon’ble Tribunal held that the assessee’s activity amounts to export within the meaning of section 80 HHC and the assessee is entitled for benefit of deduction u/s 80 HHC of the Act ? (III) Whether the Tribunal was justified in rejecting the claim of the assessee for the deduction u/s 80HHC by relying on the order of the Bombay High Court made in the context of the Sales : 2 : Tax Levy, whereas the provisions of Section 80 HHC of the I.T. Act are different, and the assessee’s claim was to be decided under the provisions of the I.T.Act ? 2. All the three questions turn upon the question as to whether the assessee was exporting any goods because unless the assessee could show that he was exporting goods he would not be able to claim any deduction u/s.80HHC(1) of the Income-tax Act. 3. The assessee was maintaining a flight kitchen for supplying meals to foreign air-lines. The A.O. following his orders passed in earlier years held that the sales made by the flight kitchen of the assessee were not exports. The CIT(A) upheld the finding that there was no export as envisaged under Section 80HHC. The ITAT also rejected the appeal of the assessee. There is thus a concurrent finding of three authorities that the assessee was not exporting goods. 4. Explanation (aaa) appended to Section 80HHC defines the term export out of India which reads as under :- . (aaa) "export out of India" shall not include any transaction by way of sale or otherwise, in a shop, emporium or any other establishment situate in India, not involving clearance at any customs station as defined in the Customs Act, 1962 (52 of 1962). : 3 : 5. All that the assessee was required to show that the food items which he was selling were cleared at a custom station as defined under the Customs Act 1962. This he was unable to do. The finding of fact is that the sale was being effected by the air-lines within India. The agreements with the air lines are not produced on record. At the stage of the hearing of this appeal an attempt was made to produce some additional documents without any supporting application. Even these documents, in our opinion, do not indicate that the goods were cleared at any custom station as defined under the Customs Act. 6. The question as to whether similar transactions of sale entered into by the assessee were covered by section 5(1) of the Central Sales Tax Act was also the issue before this Court in the Writ Petition No.2939 of 1988 and this Court observed in paragraph 117 as under :- . "In the net result, in view of the aforesaid conclusions reached by us and in view of our finding that this transaction is not covered by the provision of section 5(1) of the CST Act, in other words, in view of our finding that sale of goods by the petitioners to the foreign going airlines is a local sale within the meaning of the BST Act and not a sale covered under section 5(1) of the CST Act, the petition fails and accordingly dismissed, however, with no order as to costs." . Though the finding is in respect of the Central : 4 : Sales Tax Act, we find that on facts this Court concluded that the sales are being effected in the flight kitchen situated within India. 7. In the net result, in our view, the questions as framed in the appeal do not arise and the same is summarily dismissed. (R.S.Mohite,J) (F.I.Rebello,J)