AJAY KUMAR MITTAL, J. - (1.) IN this reference the Income -tax Appellate Tribunal, Chandigarh Bench, Chandigarh (hereafter referred to as "the Tribunal"), has refereed the following question of law to this Court under s. 256(1) of the IT Act, 1961 (for short "the Act"), for the asst. yr. 1983 -84 : "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the assessee as an exporter in the asst. yr. 1982 -83 for claiming deduction of Rs. 2,80,955 under s. 80HHC(l)(b) of the IT Act, 1961, at 5 per cent of incremental turnover of Rs. 56,19,099 (Rs. 56,66,189 -Rs. 47,090) -
(2.) BRIEFLY noticed, the facts are that the assessee company claimed deduction @ 5 per cent, of the incremental turnover at Rs. 2,80,955 under s. 80HHC of the Act for the asst. yr. 1983 -84. The said amount was arrived at by reducing the export sales of the earlier year i.e., Rs. 47,090 from the export turnover of the year under consideration, i.e., Rs. 56,66,189. The claim was not allowed by the AO on the ground that in the immediately preceding year the assessee company who was only a partner in the firm had not exported any goods out of India and, therefore, there was no incremental turnover in the year under consideration. The said action of the AO was confirmed by the CIT(A). The assessee company took the matter before the Tribunal and the Tribunal by placing reliance upon a judgment of the 56,19,099 to be the incremental turnover qualifying for deduction @ 5 per cent, under s. 80HHC(l)(b) of the Act and directed the AO to allow 5 per cent, deduction of incremental turnover as per law.
(3.) LEARNED counsel for the Revenue submitted that the Tribunal had wrongly allowed the deduction under s. 80HHC(1) (b) of the Act and has allowed the additional deduction of 5 per cent, on incremental turnover of Rs. 56,19,099. According to learned counsel, the assessee company started exporting the goods directly in the year under consideration and, therefore, in view of sub -s. (3), the assessee was not entitled to claim 5 per cent, deduction on incremental turnover under s. 80HHC(1)(b) of the Act. Learned counsel further submitted that the reliance of the Tribunal on CIT vs. Ramniklal Kothari (supra) is misplaced. No one has appeared on behalf of the assessee to oppose the reference made by the Tribunal.;