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| The Tax Publishers2020 TaxPub(DT) 0733 (Bom-HC) : (2021) 430 ITR 0109 INCOME TAX ACT, 1961
Section 80HHC
Receipts by way of shipping agency fees and higher charges for machinery and installation would be reduced from profits in terms of Explanation (baa) to section 80HHC since they had no nexus as such with export. However, such receipts would be computed on net basis and not on gross basis and accordingly, the reduction would also be effected only on net basis, and not on gross basis.
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Deduction under section 80HHC - Computation - Whether receipts by way of shipping agency fees and hire charges of machinery and installations liable to be reduced from profits -
Issue under consideration was whether receipts by way of shipping agency fees and hire charges of machinery and installations would be reduced from profits in terms of Explanation clause (baa) to section 80HHC and whether such reduction would be effected on net basis or on gross basis. Held: Receipts by way of shipping agency fees and higher charges for machinery and installation would be reduced from profits in terms of Explanation (baa) to section 80HHC since they had no nexus as such with export. However, such receipts would be computed on net basis and not on gross basis and accordingly, the reduction would also be effected only on net basis and not on gross basis.
REFERRED : ACG Associated Capsule (P) Ltd. v. CIT (2012) 18 taxman.com 137 (SC): 2012 TaxPub(DT) 0651 (SC), CIT v. Sesa Goa Ltd. [Tax Appeal No. 81/2006 decided on 7-5-2015], V.M. Salgaoncar & Brother Pvt. Ltd. v. CIT [Tax Appeal No. 21of 2011, decided on 22-11-2019]: 2019 TaxPub(DT) 8047 (Bom-HC)
FAVOUR : Partly in favour of assessee.
A.Y. :
INCOME TAX ACT, 1961
Section 80HHC
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