Whether exchange gain on creditor excise duty refund & sale of scrap is eligible for 80-IC deduction

Описание: [2023] 451 ITR 403 (Guj)
[IN THE #GUJARAT #HIGH #COURT]
PRINCIPAL COMMISSIONER OF INCOME-TAX
v.
#RECKITT #BENCKISER #HEALTHCARE #INDIA #LTD.
MS. SONIA GOKANI and SANDEEP N. BHATT JJ.
#January 3, 2023.
Playlist: 80-IC
#80-IC: #Special #provisions in respect of certain undertakings or enterprises in certain special category #States.
A.Y. 2009-10 / Assessee
Question: Whether #exchange #gain on #creditor #excise #duty #refund & #sale of #scrap is eligible for 80-IC #deduction

1. For the assessment year 2009-10, the Assessing Officer made disallowances under section 80-IC of the Income-tax Act, 1961 on account of (a) foreign exchange gain made on the ground that it was not income derived from business and did not have immediate and direct nexus with the manufacturing activity since it was not eligible for deduction under section 10A, (b) refund of excise duties paid on material and other items purchased for manufacturing purpose holding that the excess duty refund did not represent the income with first degree of nexus with the manufacturing profits, and (c) the value of scrap generated in the manufacturing process.

2. The Commissioner (Appeals) deleted the additions.

3. The Tribunal upheld the order of the Commissioner (Appeals).

4. Held, dismissing the appeal, that the Tribunal did not err in deleting the disallowance made on account of deduction on foreign exchange gain under section 80-IC.

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