- (1.) This appeal was admitted by an order dated 10 November 2003 on the following substantial questions of law;- i) Whether on the facts and in the circumstances of the case the Tribunal erred in holding that the deduction under Section 80 HHC shall be allowable after adjustment of loss from export of manufactured goods against the profits from export of trading goods? ii) Whether the Tribunal on the facts and in the circumstances of the case failed to appreciate that the provisions of sub-Section (3) of Section 80HHC read with the proviso thereto preclude the adjustment of loss from one line of export trade against the profits from another line of export trade?
(2.) After hearing the learned Counsels for the parties and after going through the impugned judgment and order and considering the aforesaid questions formulated it appears to us the issues raised by the appellant have been conclusively decided by the Hon'ble Supreme Court not only by a single Judgment but by three Judgments. In the case of (Ipca Laboratory Ltd. v. Deputy Commissioner of Income-Tax) reported in 266 ITR P.521 wherein it has been held amongst others undoubtedly Section 80HHC has been incorporated in the Income Tax Act, 1961 with a view to providing incentive for earning foreign exchange. If words in the section of statute are clear no benefit can be conferred by ignoring or misinterpreting the words in section. A plain reading of section 80HHC makes it clear that in arriving at profit earned from export of both self manufactured goods and trading goods; the profits and losses in both trades have to be taken into consideration. If after such adjustment there is a positive profit the assessee would be entitled to deduction.
(3.) Thereafter in the case of (Income-Tax Officer v. Induflex Products P. Ltd.) reported in 2006 280 ITR 1 , the same view has been taken and in the case of (Commissioner of Income Tax v. B. Mohanchandran Nair) reported in 2006 285 ITR 226 the view taken in the aforesaid two cases by the Hon'ble Supreme Court have been followed.;