V.P. Mohankumar J. -
(1.) THESE four appeals raise similar questions. Of them two appeals are preferred by the assessee whereas the other two by the Revenue. Conflicting views have been expressed by the Tribunal on identical sets of facts necessitating both the Department and the assessee to invoke the jurisdiction of this court. While I. T. A. No. 4 of 1999 and I. T. A. No. 5 of 1999 have been preferred by the assessee, I. T. A. No. 97 of 2000 and I. T. A. No. 98 of 2000 have been preferred by the Department. We shall deal with the set of facts separately.
I. T. A. Nos. 4 and 5 of 1999 :
(2.) THESE are the appeals preferred by the assessee. They relate to different assessment years but the facts herein are identical. We will summarise the facts after omitting those which are not material, as under :
The assessee is the appellant in the above appeals. The assessee is engaged in processing and export of marine products. During the previous year relevant to the assessment year 1993-94, the appellant had an export turnover of Rs. 10,24,12,075. With respect to the assessment year 1994-95, the subject-matter of appeal in I. T. A. No. 5 of 1999, the export turnover was Rs. 25,65,69,887. The exports made by the assessee to the foreign buyers are routed through export houses.
The nature of transaction was processing and shipment of the cargo by the assessee and endorsement of the bill of lading in favour of the export houses after the goods crossed the customs frontiers of India. In addition to the direct receipt from the importer outside India of the price as per contract described as f. o. b. value, the assessee received an additional amount called premium or incentive, etc., varying from 3 to 5.5 per cent, in the course of export itself from the export houses through which the exports were routed. The amount thus received is described as incentive received from the export houses. The other agreements subject matter of I. T. A. No. 5 of 1999 employs the same phraseology. The assessee submits that the assessee has not rendered any service to earn an incentive or brokerage or service charges or commission, etc., and according to the assessee, it has not done anything other than exporting the goods and endorsing the documents of title to the goods in favour the export houses. In other words, the assessee alleged that it did not act in any other capacity otherwise than as an exporter selling the goods in the course of export.
The Assessing Officer while computing export profit for granting deduction under Section 80HHC excluded 90 per cent, of the premium received from export houses by applying Explanation (baa) to Sub-section (4A) of Section 80HHC of the Income-tax Act.
(3.) AGGRIEVED by the partial disallowance of exemption claimed with respect to the abovesaid amount the assessee filed appeals before the Commissioner of Income-tax (Appeals), Thiruvananthapuram, who dismissed the appeals and confirmed the assessment order. The assessee thereupon filed second appeals to the Income-tax Appellate Tribunal who also confirmed the disallowance. In doing so, the Tribunal has relied on its own decision in G. Gan-gadharan Nair v. ITO  54 ITD 15 (Cochin) and that of the High Court in CIT v. V.T. Joseph  225 ITR 731 (Ker). But the assessee points out that G. Gangadharan Nair v. ITO  54 ITD 15 (Cochin), the first of the decisions relied on by the Tribunal, was set aside by this court and remanded back to the Tribunal for reconsideration. It is contended by the assessee that the decision of the court in CIT v. V. T. Joseph  225 ITR 731 (Ker) is not applicable to the assessee's case.
Aggrieved, the assessee has preferred the above appeals under Section 260A of the Income-tax Act contending that the following substantial questions of law arise for decision by, this court, namely :--
"(a) Whether, on the facts and in the circumstances of the case, the Tribunal had jurisdiction to go into any issue other than the deductibility of 90 per cent. of the receipts from the export houses ?
(b) If the answer to the first question is in the negative then whether, on the facts and in the circumstances of the case, when the issue of the applicability of Section 80AB was not before it, was the Tribunal justified in going into this issue and holding against the assessee ?
(c) Assuming that the Tribunal had such jurisdiction having regard to the definition of the term 'profits from business' under Clause (baa) of the Explanation was the Tribunal justified in invoking the provisions of Section 80AB which are general principles as distinct from the special provisions contained in Section 80HHC ?
(d) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in relying upon the decision in CIT v. V.T. Joseph  225 ITR 731 (Ker), which dealt with different provisions for a different assessment year and even if it was right, should not the Tribunal have followed the later decision of this court in CIT v. A. V. Thomas and Co, Ltd.  225 ITR 29 and allowed the claim ?
(e) Whether, on the facts and circumstances of the case, was the Tribunal justified in holding that the premium received from the export houses is brokerage or commission or charges or any other receipt of a similar nature qualified for disallowance under Explanation (baa) of Sub-section (4A) of Section 80HHC ?
(f) Whether, on the facts and in the circumstances of the case, whether the Tribunal was justified in law in holding that 90 per cent. of the receipts from the export houses are deductible from the business profits determined under Clause (baa) of the Explanation to Section 80HHC for the purpose of quantifying relief under that section ?
(g) Whether, on the facts and in the circumstances of the case, the Tribunal had jurisdiction to go into the issue of the receipts from the export houses being a part of the total turnover when that was not an issue at all before it ?"
I T. A. Nos. 97 of 2000 and 98 of 2000 :
These appeals are preferred by the Department with respect to the assessment years 1993-94 and 1994-95. The facts are as under :
The assessment relates to the years 1993-94 and 1994-95. The assessee is different from the assessee whose appeals are dealt with in I. T. A. Nos. 4 of 1999 and 5 of 1999. The assessee who had effected its export through export houses was paid a fixed percentage of f. o. b. value described as incentive, service charges, premium, etc., by the export house. In the instant case, the Assessing Officer noticed that these payments are effected in favour of the assessee by the export house. It pointed out that by virtue of such exports the exporter is entitled to licence or additional licence on account of the export. This was being transferred to the export house under the contract and it will be received by the export house. According to the Department it was in these circumstances, the Assessing Officer held that the assessee was not entitled to the deduction envisaged under Section 80HHC. He disallowed the assessee's claim for deduction under Section 80HHC. In doing so he followed the decision of the Income-tax Appellate Tribunal, Cochin Bench, in the case of A.M. Moosa, Chandiroor, in I. T. A. No. 498/Cochin of 1995, dated September 14, 1995. The assessee being aggrieved preferred an appeal before the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax (Appeals) confirmed the order of the Assessing Officer. Aggrieved, the assessee preferred appeal before the Tribunal.