Topic
ITAT Delhi rules that government grants received under the Focus Product Scheme qualify as capital receipts, exempting them from Minimum Alternate Tax (MAT) under Section 115JB. The decision clarifies the tax treatment of export incentives, impacting corporate tax planning and compliance for businesses availing such schemes.
CESTAT Chennai rules that goods exported under the DEPB scheme must not be counted as exempted goods when calculating Cenvat credit reversal under Rule 6(3) of the CCR, 2004. This clarifies that export incentives like DEPB do not trigger credit reversal obligations, benefiting manufacturers who blend dutiable and exempted production with export-oriented schemes.
Madras High Court reinforces that deductions under Sections 80 IB and 80 HHC of the Income Tax Act must be computed independently, not sequentially. The ruling sets aside ITAT’s order, mandating reassessment in line with the Supreme Court’s precedent in Shital Fibers Ltd, impacting tax computation for export-oriented businesses.
The CETAT holds that customs authorities cannot demand duty or impose penalties under Section 28AAA unless DGFT has first cancelled export incentive scrips. Key precedent for exporters and brokers.