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DATE: October 8, 2015 (Date of pronouncement)
DATE: October 27, 2015 (Date of publication)
AY: 2005-06
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S. 10A/ 10B: After AY 2001-02 when s. 10A/ 10B became “deduction” provisions instead of “exemption” provisions, the deduction has to be computed before adjusting brought forward unabsorbed losses /depreciation

The deduction under s. 10A has to be given effect to at the stage of computing the profits and gains of business. This is anterior to the application of the provisions of s.72 which deals with the carry forward and set off of business losses. A distinction has been made by the Legislature while incorporating the provisions of Chapter VIA Section 80A(1) stipulates that in computing the total income of an assessee, there shall be allowed from his gross total income, in accordance with and subject to the provisions of the Chapter, the deductions specified in ss.80C to 80U. S.80B(5) defines for the purpose of Chapter VI-A “gross total income” to mean the total income computed in accordance with the provisions of the Act, before making any deduction under the Chapter

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DATE: October 6, 2015 (Date of pronouncement)
DATE: October 12, 2015 (Date of publication)
AY: 2002-03
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S. 10A/ 80HHE: Claiming deduction u/s 80HHE for one year does not debar the assessee from claiming deduction u/s 10A for another year. Fact that claim is not made via a revised return is no bar on the right of the appellate authority to consider it

Making of a claim under Section 80HHE of the Act in one assessment year will not preclude an Assessee from claiming the benefit under Section 10A of the Act in respect of the same unit in a succeeding assessment year. The purpose of the Section 80HHE(5) of the Act was to avoid double benefit but that would not mean that if for a particular assessment year the Assessee wants to claim a benefit only under Section 10A of the Act and not Section 80HHE, that would be denied to the Assessee

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DATE: August 11, 2015 (Date of pronouncement)
DATE: August 21, 2015 (Date of publication)
AY: 2009-10
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S. 40(b)(v): Provision in partnership deed for payment of salary at percentage share of profits multiplied by “allocable profits” is valid and entitles claim for deduction. S. 37(1): Contribution by law firm to IFA to create awareness of its activities is business expenditure

A plain reading of Clause 6(a) leads us to a conclusion that the term ‘allocable profits’ was used to mean ‘book profits’ as used in Section 40(b)(v) of the Act or otherwise the reference to the section in the Clause has no meaning. When the partners have understood and meant that the word “allocable profits” to mean surplus/book profits, prior to calculation of partners’ remuneration, and when such an understanding is manifest in its actions, we do not see any reason why the Revenue authorities should not understand this term in the same sense

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DATE: July 3, 2015 (Date of pronouncement)
DATE: July 15, 2015 (Date of publication)
AY: 2008-09
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S. 54: Booking a flat which is going to be constructed by the builder is a case of “construction” of the flat. If the flat is booked prior to the date of transfer of the old flat, deduction u/s 54 is not available. The date of receiving possession of the new flat cannot be regarded as the date of “purchase” of the new flat

The booking of a flat which is going to be constructed by a builder has to be considered as a case of “Construction of flat”. Deduction u/s 54 is available only if the assessee constructs a new house within three years after the date of transfer. In the instant case, the assessee has constructed a house prior to the date of transfer of original house, in which case, the assessee is not entitled to claim deduction u/s 54 of the Act in respect of the cost of new flat

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DATE: May 27, 2015 (Date of pronouncement)
DATE: May 29, 2015 (Date of publication)
AY: 2009-10
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S. 80-IC: The benefit of “substantial expansion” is applicable to units which were in existence at the time of announcement of scheme i.e. in AY 2004-05. Assesses who installed new units during this period and are now going for substantial expansion are not eligible to claim deduction u/s 80IC

If interpretation given by the assessee is to be accepted, the provision would become discriminatory for two classes of undertakings i .e. new units and old units. Because the old units would be entitled to 100% deduct ion on expansion for first five years and 25% thereafter whereas the new units would become entitled to deduction for 100% for first five years and again @ 100% on substantial expansion. Such discriminatory intention cannot be imputed to the Legislature.

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DATE: May 7, 2015 (Date of pronouncement)
DATE: May 19, 2015 (Date of publication)
AY: 1990-91
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S. 43B: "Vend fee" paid by the assessee to the Government, even if of the nature of "privilege fee" falls within the expression "fee by whatever name called"

A reading of Section 43B after it was substituted by the Finance Act, 1988 with effect from 01.04.1989 shows that sub clause (a) in Section 43B has been considerably widened by the amendment by the addition of the words “by whatever name called”. It is clear, therefore, that to attract this section any sum that is payable whether it is called tax, duty, cess or fee or called by some other name, becomes a deduction allowable under the said Section provided that in the previous year, relevant to the assessment year, such sum should be actually paid by the assessee

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DATE: April 1, 2015 (Date of pronouncement)
DATE: April 8, 2015 (Date of publication)
AY: -
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S. 80HHC: It is a pre-requisite that there must be profits from the export business. If the exports business has suffered a loss, deduction cannot be allowed from domestic business

From the scheme of Section 80HHC, it is clear that deduction is to be provided under sub-section (1) thereof which is “in respect of profits retained for export business”. Therefore, in the first instance, it has to be satisfied that there are profits from the export business. That is the pre-requisite as held in IPCA and A.M. Moosa as well. Sub-section (3) comes into picture only for the purpose of computation of deduction. For such an eventuality, while computing the “total turnover”, one may apply the formula stated in clause (b) of subsection (3) of Section 80HHC. However, that would not mean that even if there are losses in the export business but the profits in respect of business carried out within India are more than the export losses, benefit under Section 80HHC would still be available

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DATE: January 13, 2015 (Date of pronouncement)
DATE: January 19, 2015 (Date of publication)
AY: 2007-08
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S. 10B(4): The argument that s. 10B(4) lays down a computational formula and that all business profits (including DEPB receipts) should be eligible for deduction irrespective of the effective source is not acceptable

We are unable to subscribe to the view expressed per the decisions relied upon by the assessee, i.e., that in view of computational formula of section 10B(4), the entire profits of the business of the undertaking, irrespective of their immediate source, shall comprise the qualifying profits

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DATE: October 30, 2014 (Date of pronouncement)
DATE: October 31, 2014 (Date of publication)
AY: 2009-10
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Though approval of Director of STPI to EOU is sufficient for s. 10A, it is not so for s. 10B. For s. 10B, the approval of the Board appointed under I(D&R) Act is necessary. Claim for s. 10A can be made before CIT(A)

(1) The fact that the assessee is a 100% EOU approved by the Director, STPI does not mean entitle the assessee to deduction u/s 10B if the undertaking is not been approved by the Board appointed in this behalf by …

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