1 itxa3419-10 sas IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.3419 OF 2010 The Commissioner of Income Tax-1, Mumbai ..Appellant. V/s. M/s. J.B. Chemicals & Pharmaceuticals Ltd. ..Respondent. Mr. Suresh Kumar for the appellant. Mr. S.P. Mehta for the respondent. CORAM : J.P. DEVADHAR AND A.A. SAYED, JJ. DATED : 10TH AUGUST, 2011 P.C. :- 1. Seven questions of law are raised by the revenue in this appeal, which read thus:- (1) Whether on the facts and in the circumstances of the case, the Tribunal, in law, was justified in holding that foreign Exchange gain of Rs.34,90,116/- should be considered as part of sale proceeds and is linked to the profit derived from industrial undertaking and cannot be reduced from the profit while working out deduction u/s. 80IA/80IB of the Income Tax Act, 1961 ? (2) Whether on the facts and in the circumstances of the case, the Tribunal, in law, was justified in holding that sale of steam of Rs. 1,00,993/- from part of profit of the business eligible for deduction u/s.80HHC of the Income Tax Act, 1961 ? 2 itxa3419-10 (3) Whether on the facts and in the circumstances of the case, and on true interpretation of various provisions of income tax and in particular Section 80HHC read with Section 28(iiid) whether, the entire amount received on sale of DEPB entitlements represents ‘profits’ chargeable u/s.28(iiid) or the profit referred to therein requires any artificial cost to be imputed as held by the Tribunal ? (4) Whether the entire amount received on DEPB entitlement represents profit chargeable u/s.28(iiid) of the Income Tax Act, 1961 or the profit referred to wherein required any artificial cost to be interpolated ? (5) Whether on the facts and circumstances of the case, the Tribunal, in law, was justified in directing the AO to recompute the deduction u/s.80HHC in accordance with the view taken by the Special bench in the case of M/s. Topman Exports ? (6) Whether on the facts and circumstances of the case, the Tribunal, in law, was justified in holding that, only the profit element of the sale of DEPB that is the amount in excess of sale proceeds over the face value is covered u/s.28(iiid) and not the entire amount received on sale of DEPB entitlements represents profit chargeable u/s.28(iiid) of the Income Tax Act, 1961 ? (7) Whether on the facts and circumstances of the case, the Tribunal, in law, was justified in directing the AO to give credit for MAT u/s. 115JA prior to the charging of interest u/s.234B and 234C in the like manner as advance tax and TDS and re-compute the interest u/s.234B & 234C ? 2. As regards question No.1 is concerned, counsel for the parties state the said question is covered in favour of the assessee by the decision of this Court in the case of CIT V/s. Amber Exports (India) reported in 326 ITR 455 (Bom). Accordingly, question No.1 cannot be entertained. 3. As regards question No.2 is concerned, counsel for the 3 itxa3419-10 parties state that in the light of the decision of this Court in the case of CIT V/s. Dresser Rand India (P) Ltd. reported in 323 ITR 429, the appeal be restored to the file of the assessing officer for fresh consideration. Accordingly, question No.2 is restored to the file of the assessing officer for fresh consideration in the light of the judgment of this Court in the case of Dressar Rand India (P) Ltd. (supra). 4. As regards question Nos.3, 4, 5 & 6 are concerned, counsel for the parties state that the said questions are covered in favour of the revenue by the decision of this Court in the case CIT V/s. Kalpataru Colour & Chemicals reported in 328 ITR 451 (Bom). Accordingly, question Nos.3 to 6 are answered in favour of the revenue and against the assessee. 5. As regards the question No.7 is concerned, counsel for the parties state that the said question stands answered against the revenue by the decision of this Apex Court in the case of CIT V/s. Tulsyan NEC Ltd. reported in 330 ITR 226 (SC). Accordingly, question No.7 cannot be entertained. 6. The appeal is disposed off accordingly with no order as to costs. (A.A. SAYED, J.) (J.P. DEVADHAR, J.)