- (1.) This appeal has been preferred by the Revenue under section 260A of the Income-tax Act 1961 (in short "the Act"), against the order dated March 31, 2005, passed by the Income-tax Appellate Tribunal, Chandigarh Bench "B" (hereinafter referred to as "the Tribunal") in I.T.A. No. 867/Chandi/2000, for the assessment year 1997-98, claiming the following substantial questions of law : (a) Whether, in the facts and in the circumstances of the case, the hon'ble Income-tax Appellate Tribunal has erred in holding that the assessee has validly withdrawn its exemption under section 10B, earlier claimed in the original return by validly filing a revised return under section 139(5) on March 31, 1998, in spite of the specific provisions of sub-section (7) of section 10B applicable for the relevant period ? (b) Whether, in the facts and in the circumstances of the case, the hon'ble Income-tax Appellate Tribunal has erred in law in holding further that the assessee has rightly claimed the impugned interest as income from business source by ignoring the decision of the apex court in the case of Tuticorin Alkali Chemicals and Fertilizers Ltd. v. CIT, 1997 227 ITR 172 ? Briefly stated, the facts necessary for adjudication as narrated in the appeal are that the assessee filed original return on November 30, 1997, for the assessment year 1997-98. The assessee had earned interest income of Rs. 33,99,620 on deposits made in banks and other companies for preoperative period and post-operative period. It claimed exemption under section 10B of the Act being 100 per cent, export oriented unit. The assessee filed a revised return under section 139(5) of the Act on March 31, 1998, by declaring the income at Rs. 7,07,433 after withdrawing the exemption claimed under section 10B of the Act as per the provisions of section 115JA of the Act. The case of the assessee was taken up for scrutiny by issuing notice under section 143(2) on June 30, 1998, and its assessment was completed on October 25, 1999, at a total income of Rs. 33,87,620. The Assessing Officer held the interest income as taxable under the head "Other sources" and the income earned on surplus funds after commencement of business also as "Income from other sources" and accordingly taxed the entire interest income of Rs. 33,99,620 as "Income from other sources". Feeling aggrieved, the assessee filed an appeal before the Commissioner of Income-tax (Appeals) (in short "the CIT(A)") who, vide order dated October 5, 2001, deleted the addition holding that the assessee was entitled to file a revised return under section 139(5) of the Act and to withdraw exemption as claimed under section 10B of the Act in the original return. Against the order of the Commissioner of Income-tax (Appeals), the Revenue filed an appeal before the Tribunal who, vide order dated March 31, 2005, dismissed the appeal. This gave rise to the Revenue to approach this court by way of the present appeal.
(2.) We have heard learned counsel for the parties.
(3.) At the outset, learned counsel for the Revenue conceded that in so far as question (b) is concerned, no argument was raised before the Tribunal and, therefore, this question does not arise for consideration in this appeal. Accordingly, question (b) is declined.;