Held that sub-cl. (iiia) of s. 28 which explains profits on sale of a license granted under the Import (Control) Order, is not applicable in the facts and circumstances of the case. Further, sub-cl. (iiib) of s. 28 provides cash assistance (by whatever name called) received or receivable by any person against exports under any scheme of the Government of India. There was no cash assistance granted to the assessee in the present case, thus, it is not applicable. Further, sub-cl. (iiic), which explains any duty of customs or excise repaid or repayable as drawback to any person against exports under the Customs and Central Excise Duties Drawback Rules, is not applicable. Further, sub-cls. (iiid) and (iiie) which explain any profit on the transfer of the Duty Entitlement Pass Book scheme and any profit on the transfer of the Duty Free Replenishment Certificate, respectively, admittedly, do not cover the facts and circumstances of the case, and so, is not applicable. Capital receipt not chargeable to tax. (AY. 2017-18, 2018-19, 2020-21)
ACIT v. Eastman Exports Global Clothing (P) Ltd. (2024) 232 TTJ 121 / 38 NYPTTJ 1190 (Chennai)(Trib)
S. 28(iiib) : Business income-Cash assistance-Capital or revenue-Subsidy or grant or cash incentives or duty drawback or waiver or concession or reimbursement Incentive received from Government for exploring new export market-MEIS Scheme under Foreign Trade Policy, 2015-Though the said amounts are brought into P&L a/c and claimed as exempt in the return of income, the said treatment in the books of accounts by itself cannot be determinative of its taxability-Benefit under Foreign Trade Policy, 2015 being MEIS scrips does not fall within the meaning of cash assistance under s. 28(iiib)-Capital receipt, not chargeable to tax. [S. 2(24)(xviii), 4]
Leave a Reply