- (1.) THIS appeal has been preferred by the Revenue under s. 260A of the IT Act, 1961 (in short, 'the Act') against the order 2000 -01, raising following substantial question of law : "Whether on the facts and law, the Hon'ble Tribunal was justified in allowing deduction under s. 80 -I on export incentives/DEPB entitlements when the same was not a profit derived from industrial undertaking -
(2.) THE assessee is engaged in the business of manufacturing and export of stationery goods. It filed its return for asst. yr. 2000 -01. The AO did not allow the claim for deduction under s. 80 -I of the Act in respect of export incentives in the form of DEPB entitlement holding that the same was not derived from industrial undertaking. Reliance was placed on judgment of the Hon'ble Supreme Court in CIT vs. Sterling Foods (1999) 153 CTR (SC) 439 : (1999) 237 ITR 579 (SC). The said view was, however, reversed by the CIT(A) and the Tribunal. The Tribunal followed judgment of the Madras High Court in CIT vs. Jameel Leathers & Uppers (2000) 246 ITR 97 (Mad) and judgment of Gujarat High Court in CIT vs. India Gelatine & Chemicals Ltd. (2005) 194 CTR (Guj) 492 : (2005) 275 ITR 284 (Guj).
(3.) LEARNED counsel for the Revenue submits that the matter is covered in favour of the Revenue by the judgment of the Hon'ble Supreme Court in Sterling Food's case (supra) and judgment of this Court in Liberty India vs. CIT (2007) 207 CTR (P&H) 243 : (2007) 293 ITR 520 (P&H). We have passed a separate order today in M/s Raj Overseas in appeal being IT Appeal No. 629 of 2007, filed by assessee against the order of the Tribunal taking a contrary view on the basis of judgment of the Hon'ble Supreme Court in Sterling Foods' case (supra) and judgment of this Court in Liberty India's case (supra). It appears that the judgment of the Tribunal in the present case was prior to the judgment of this Court in Liberty India's case (supra). Judgment in;