RAJESH BINDAL J. - (1.) THE Revenue has filed the present appeal raising the following substantial question of law arising out of the order passed 2004, for the asst. yr. 1996 -97. "Whether, on the facts and in the circumstances of the case, the Tribunal was right in directing that indirect cost for computation of deduction under s. 80HHC be reduced by 10 per cent of incentive income earned -
(2.) THE assessee is a partnership firm engaged in the business of purchase and export of goods. The IT return for the the AO found that the assessee, while working out the indirect cost of goods exported, claimed deduction at 10 per cent as indirect expenses on account of expenses incurred for earning export incentives, miscellaneous income and brokerage etc. The claim made by the assessee was disallowed by the AO and assessment under s. 143(3) of the IT Act, 1961 (for
(3.) AGGRIEVED against the order of assessment, the assessee preferred an appeal before the CIT(A), who vide his order expenses relatable to the earning of export incentives and other miscellaneous income was not permissible under any provision of s. 80HHC of the Act as forming part of the indirect cost. Still aggrieved against the order passed by the CIT(A) the assessee preferred further appeal before the Tribunal. The Tribunal accepted the plea of the assessee by referring to Expln. (baa) to s. 80HHC of the Act and also by relying upon an earlier order passed by it in ITA No. 803/Chd/1997. It is this order of the Tribunal which is impugned by the Revenue in the present appeal.;