- (1.) WE have heard Shri A.N. Mahajan for the revenue. Shri Suyash Agarwal appears for the Assessee.
(2.) IT is submitted by Shri A.N. Mahajan, that the question, whether the receipt on sale of leather waste, pattern designing development, sample and job charge in Indian currency should be included in the total export turnover as well as in the total turnover for allowing deduction under Section 80 -IA as well as under Section 80 -HHC as per provisions of Section 80 -IA(9A) of the Act, requires consideration of the Court. He has relied upon judgments in Liberty India v. Commissioner of Income Tax, 317 ITR 218 (SC) as well as Malawar Industrial Co. Ltd v. Commissioner of Income Tax, 243 ITR 83 (SC). In our opinion all the three questions require consideration by this Court. The appeal is thus admitted on the questions as follows: - (1) Whether on the facts and in the circumstances of the case, the Tribunal is justified in law in setting aside the order passed Under Section 263 of the Act by coming to the conclusion that the assessment order could not be termed as erroneous and prejudicial to the interest of the revenue within the meaning of Section 263 of the Act. (2) Whether the deduction Under Section 80 -HHC of the Act is to be allowed from the export profit without reducing the amount of deduction allowed Under Section 80 -IA of the Act. (3) Whether the receipt on sale of 'Leather waste', 'pattern designing development,' 'sample' and 'job charge' in Indian currency should be included in the total export turnover as well as in the total turnover for allowing deduction under Section 80 -IA as well as under Section 80 -HHC as per provisions of Section 80 -IA(9A) of the Act
(3.) SHRI Suyash Agarwal submits that the question No. 1 is no longer res integra in view of the judgment in CIT v. Max India Ltd, 295 ITR 282 (SC). In Section 263 the phrase "prejudicial to the interest of the revenue" has to be read in conjunction with the expression erroneous. He submits that in the present case the order passed by the Assessing Officer was not erroneous in nature.;