IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. I.T.A. No.63 of 2002 (O&M) Date of decision: 18.4.2011 Nahar Spinning Mills Ltd. -----Appellant. Vs. Commissioner of Income Tax. -----Respondent. CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOEL HON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present:- Mr. Sanjay Bansal, Sr. Advocate with Ms. Shweta Malhotra, Advocate for the appellant. Mr. Denesh Goyal, Standing Counsel for the respondent. --- ADARSH KUMAR GOEL, J. This appeal has been preferred by the assessee under Section 260-A of the Income Tax Act, 1961 (for short, “the Act”) against the order of the Income Tax Appellate Tribunal, Chandigarh in ITA No.191/CHD/93 and C.O. No.56/CHD/93 for the assessment year 1989-90 claiming following substantial questions of law:- “1. Whether a proper construction of section 80-I and proper understanding of the Supreme Court’s decision reported in ITR 237 Page 579, in the case of Sterling Foods, the Tribunal did not err in law in holding that I.T.A. No.63 of 2002 the income received by the assessee by way of CCA did not qualify for exemption from tax to the extent indicated in the said section? 2. Whether on the facts and circumstances of the case the Tribunal did not err in law in holding that the income received by the assessee being of very nature, that is additional price for exports could not be said to be income derived from the industrial undertaking of the assessee within the meaning of Section 80-I of the Income Tax Act? 3. Whether on the facts and circumstances of the case the Tribunal did not err in holding that profits or sale of import entitlements were of the same nature as CCA received? 4. Whether the Tribunal did not err in holding that only such profits of an industrial undertaking were exempt from tax u/s 80-I as were obtained from sale of manufactured goods? 5. Whether on the facts and circumstances of the case and on proper construction of section 80-I the ITAT did not err in law in holding that the interest income earned on fixed deposits in the circumstances they were made with the banks could not be adjudged as income derived by the assessee undertaking within the meaning of section 80-I and 80 HHC of the Income Tax Act? 6. Whether on the facts and circumstances of the case and on proper construction of provisions of section 80HHC, the ITAT did not err in law in holding that the interest income derived from fixed deposit receipt taken for L/Cs or guaranty would not be construed as profits and gains of the business of the assessee 2 I.T.A. No.63 of 2002 within the meaning of Section 80 HHC of the Income Tax Act?” Learned counsel for the appellant fairly states that the matter is covered against the assessee by judgment of the Hon’ble Supreme Court in Liberty India v. CIT (2009) 317 ITR 218. Accordingly, this appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE April 18, 2011 ( AJAY KUMAR MITTAL ) ashwani JUDGE 3