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5. The petitioner herein claimed deduction to the extent envisaged under section 80J of the Act at the rate of six per cent. per annum on the capital in respect of the amount in a sum of Rs. 5,70,704 as income derived from his business. The income, it is not in dispute, was derived from the sale of the import licences obtained as an incentive on the export of shrimps.

6. We are tempted to refer to the statement of the case by the Tribunal for knowing the foundational facts and also because there is a fair attempt by the Tribunal to derive the meaning of "income derived from" from certain authorities on the subject. The business of the assessee company is processing and exporting of seafoods, such as shrimps, etc. It, in the course of the said business, obtained import licences as an incentive to the business, extended under a policy of the Central Government known as the Import Trade Control Policy (for Registered Exporters) for the years 1972-73 and 1973-74. The objective of the said policy as extracted in the statement of the case was as under :

'For the purposes of attracting clause (iv) of section 28 of the Income-tax Act, it is necessary that the benefit should arise from business. It would be seen that the advantage of receiving the entitlement originated from and was intimately connected with the business which the assessee was doing. In case the assessee would not have exported the goods under the Special Exports Promotion Scheme to the extent of the value mentioned therein, it would not have obtained the entitlements. It is thus clear that the entitlements sprang up or came into being because of the business which the assessee was doing. The dictionary meaning of the word "arise" given in the Chambers' Twentieth Century Dictionary as originate, to come into being, leaves no room for doubt that income from import entitlements had actually arisen from the assessee's business.' The dictionary meaning of 'derived from' extracted above, viz., to have one's origin from, is almost identical with the dictionary meaning of 'arise' referred to in the above observation of the High Court. We are hence of the view that applying the ratio of the above High Court decision, the sale proceeds of import entitlements in the assessee's case also should be taken as 'derived from' or arising from the assessee's business which is an industrial undertaking for processing seafoods.
This observation lays emphasis on the profit being derived from the conduct of the business. There can be no doubt that, bearing in mind the nature of the import licences are derived from the assessee's conducting of the business, namely, the industrial undertaking of processing of goods (sic). We say so because the conduction of the business will involve not merely the direct export sale of the processed seafoods, but also the inevitable concomitant of that sale, viz., the assessee's entitlement to the import licences and the sale thereof, which occurred in the course of the business itself.' Regarding the judicial decisions relied on by the Revenue in Kunwar Trivikram Narain Singh's case and J. K. Trust's case [1953] 23 ITR 143 (Bom), the Tribunal distinguished these decisions. The Tribunal, thus, held that the sale proceeds of the import entitlements should be taken as 'derived from' the industrial undertaking within the meaning of section 80J. In any event if two interpretations are possible regarding the scope of the expression 'derived from', the interpretation in favour of the assessee will have to be adopted having regard to the ratio of the Supreme Court decision in CIT v. Vegetable Products Ltd. [1973] 88 ITR 192, in which it was held that 'if the court finds that the language of a taxing provision is ambiguous or capable of more meanings than one, then the court has to adopt that interpretation which favours the assessee ...' The Tribunal thus allowed the assessee's contention."