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August 2013

Chafer VI-A – Special Deduction – Duty drawbacks is not derived from industrial undertaking and thus is not eligible for deduction u/s. 80 IA.

By Kishor Karia, Chartered Accountant
Atul Jasani, Advocate
Reading Time 1 mins
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Commissioner of Income-tax vs. Orchev Pharma P. Ltd. [2013] 354 ITR 227 (SC)

The High Court dismissed the appeal of the revenue on the following question of law following its decision in CIT vs. India Gelatin and Chemicals Ltd. (2005) 275 ITR 284 (Guj).

“Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in allowing the deduction u/s. 80-IA of the Income-tax Act, 1961, by including the amount of duty drawback?”

The Supreme Court allowed the appeal of the Department in view of its decision in Liberty India vs. CIT (2009) 317 ITR 218 (SC).

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