- (1.) THE appeal is directed against a judgment and order dated 29th August, 2003 passed by the learned Tribunal rejecting the contentions of the assessee. The assessee has come up in appeal. As regards the business activities of the assessee, the Assessing Officer in his assessment order has found as follows: The assessee company is engaged in manufacturing of gear boxes coupling and standard accessory in their factory at Calcutta. Most of the assessee's customers are industries like Cement, Papers, Power House, Railways, Mining etc. The assessee has also got a software business called Computer Aided Design Software at Chennai. This was established as a separate line of activity in Chennai to export 100% of its product. In computing the income of the assessee, the Assessing Officer computed the income arising out of the business in respect of gear box etc under the heading "A" and in respect of the software business under the heading "B". In other words, these two different activities were differently treated even in the assessment order. The CIT (A) proceeded on the basis that "obviously there is no absolute clarity in the language of the Section, otherwise all this debate about the interpretation of the term "total turnover of the business" would not have arisen at all. There is, however, no material difference between the language of Section 80HHC(3) and that of Section 80HHE(3)." The CIT(A) concluded that "there is hardly any scope to argue that the total turnover for the purpose of computation of eligible profit under sub Section (3) of Section 80HHE will only be the turnover in respect of the business of computer software and the turnover in respect of the business of gear boxes, couplings and spares is to be disregarded."
(2.) THE learned Tribunal, agreeing with the views expressed by the CIT (A) and relying on the judgment in the case of CIT vs. Parry Agro Industries Ltd., reported in : 257 ITR 41 [Ker.], upheld the views of the CIT(A) and added that in arriving at the admissible deduction under Section 80HHE the Assessing Officer has also to take into account the negative profit arising out of the business of gear box. The questions in the circumstance, which arise for determination, are as follows: [a] Whether there is any material difference between Section 80HHC(3) and Section 80HHE(3)? [b] Whether the turnover and profit or loss arising out of the business of gear box etc. is to be taken into account for the purpose of determining admissible deduction under Section 80HHE(1)? In so far as the first question is concerned, it was pointed out by Mr. Bajoria, learned Senior Advocate appearing for the appellant, that Section 80HHC contemplates a case where the assessee is engaged "in the business of export out of India of any goods or merchandise except" "minerals and mineral oil", whereas Section 80HHE contemplates a case where the assessee is engaged "in the business of export of computer software or in the business of providing technical services outside India."
(3.) MR . Bajoria submitted that it is altogether erroneous to proceed on the basis that the sections operate in the same field or are intended to cover the same activity. Therefore, the ratio of the judgments arising out of any interpretation of Section 80HHC cannot be applied to any question arising out of Section 80HHE.;