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1 - 4 of 4 (0.18 seconds)Commissioner Of Income Tax, Coimbatore vs M/S. Lakshmi Machine Works on 25 April, 2007
4. Insofar as non-inclusion of sum of Rs.1168.23 lakhs received
by the assessee as money-changer activity, the Tribunal has
noted that, right from the beginning, the assessee had
provided this facility to its residents/guests on no-profit-no-
loss basis. It is for this reason, the assessee was not even
allowed deduction under Section 80HHD on the foreign
ITA No.656/2009 Page 3 of 6
exchange receipts from its money-changing activity. We may
also notice that the contention of the assessee in this behalf
was that the money-changing exercise undertaken by the
assessee for its guests/customers is only a facility for its
guest/customers granted to them and it is for this reason that
the assessee simply converts the money taken in foreign
exchange from its customers by paying them equivalent
money in Indian currency. For this reason, asserted the
assessee, there was no element of profit in these receipts. It
was argued that the assessee collects this amount in fiduciary
capacity and in the interest of its main business by providing
this additional facility to its customers. Otherwise, the
amount so collected in fiduciary capacity is deposited with the
Government. The Tribunal while holding that since the
receipts with the money changer would not be eligible for
computation of the deduction admissible under Section
80HHD and deserves to be excluded from the total turnover
as a whole. The Tribunal has taken recourse to the judgment
of the Supreme Court in CIT v. LAKSHMI MACHINES
WORKS, 290 ITR 667 in support of its view. Learned counsel
for the respondent also brought to our notice that not only in
previous assessment years but even in subsequent
assessment years, the Department itself has been acting in
the same manner. Learned counsel has produced copies of
ITA No.656/2009 Page 4 of 6
the assessment orders passed in respect of assessment years
1996-97, 1997-98 as well as 1999-2000 to bolster this
submission. We find from the assessment order passed in
respect of assessment year 1997-98 that while adopting the
same approach, the Assessing Officer, in the rank of Joint
Commissioner of Income Tax, has observed as under:
Section 115JA in The Income Tax Act, 1961 [Entire Act]
Section 148 in The Income Tax Act, 1961 [Entire Act]
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