Saturday 20 May 2017

Sec.80HHD not analogous with Sec.80HHC, allows deduction without reducing ineligible hotel’s losses

Madras HC upholds ITAT order for AY 1998-99, holds that while computing 'eligible profit' for allowing deduction u/s 80HHD(1) (available to companies running hotels) loss from ineligible units/hotels cannot be deducted; Rejects Revenue’s stand that the expressions ‘business profits’ and ‘total receipts’ used in Sec. 80HHD(3) [prescribing formula for computing ‘eligible profits’], should take into account the gains/losses of ineligible entities as well;  Noting that Sec. 80HHD is a ‘beneficial provision’, HC opines that “full benefit of the provision should be extended to an eligible assessee without there being an attempt to whittle down the same.”; HC rules that “sub-section (3) has to be read along with sub-section (1) by statutory prescription and in such an event, all parameters of the formula should relate solely to the receipts/profits/income of the eligible unit alone and none other.”; Cites Karnataka HC ruling in ITC Hotels Ltd., holds that the deduction should be granted qua eligible unit/units only, clarifies that Revenue cannot draw support from Sec. 80HHC provisions and the two provisions (i.e Sections 80HHC and 80HHD) are not analogous:HC 

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Pre-GST taxes cannot be refunded if paid pursuant to an inquiry

  This is to update you about an important decision by Tribunal in the case of Filatex India Limited vs. CCE & ST , E A No. 10231 of ...