Aloke Chakrabarti, J. - (1.) This is an appeal filed by the assessee under Section 260A of the Income-tax Act, 1961, against the judgment of the Appellate Tribunal in respect of its assessment for the assessment year 1997-98.
(2.) The assessee carried on business of manufacture and sale of alloy, free cuttings and special sheets, black and bright bars, electrical stampings, laminations, strip wound cores, bolts and nuts, rivets and spikes for special purpose machinery, etc. The assessee also exports the goods manufactured by it.
(3.) In respect of exports made by the assessee, it is granted benefit by way of duty free imports. Prior to the previous year ending March 31, 1997, the assessee qualified for the said benefits by way of duty free imports. As and when it accrued to the assessee, the same was shown in its accounts. Based on the quantum of exports made during the previous year ending on March 31, 1997, the assessee, in its accounts for the said previous year, passed a book entry debiting export benefit receivable account and crediting miscellaneous income account for the amount of customs duty benefits of Rs. 228.34 lakhs which would have accrued to the assessee on the import of the materials. The profit and loss account showed a better picture due to taking into consideration of the said sum of Rs. 228.34 lakhs. In its return of income for the assessment year 1997-98, the assessee deducted the said notional income of Rs. 228.34 lakhs from the profit as per the profit and loss account in order to arrive at the correct figure of taxable income.;