ORDER
G.S. Pannu, A.M.
1. This is an appeal by the Revenue against the order of the CIT(A), dt. 19th Oct., 2004 pertaining to asst. yr. 2001-02.
2. The only ground in this appeal taken by the Revenue is with regard to the decision of the CIT(A) in directing the AO to allow deduction under Section 80-IB of the IT Act, 1961 (hereinafter referred to as ‘the Act’) in respect of duty drawback. In the ground of appeal itself, the Revenue contends that the CIT(A) has erred in not considering the judgment in the case of CIT v. Sterling Foods . Hon’ble Madras High Court in the case of CIT v. Viswanathan & Co. (2003) 181 CTR (Mad) 335 : (2003) 261 ITR 737 (Mad); CIT v. Jameel Leathers & Uppers and Hon’ble Delhi High Court in the case of CIT v. Ritesh Industries Ltd. (2004) 192 CTR (Del) 81.
3. Before me, Smt. Veena Joshi, learned Departmental Representative has appeared on behalf of the appellant-Revenue. She has heavily relied on the above judgements in support of her stand. In the aforesaid judgments, it has been held that the export incentive do not form part of the profit derived from industrial undertaking and therefore not eligible for deduction under Section 80-I. It is further submitted by the learned Departmental Representative that duty drawback was one form of export incentive and therefore, the aforesaid judgments clearly cover the case of the Revenue.
4. On the other hand, learned counsel appearing on behalf of the assessee has drawn my attention to various judgments of the Delhi Bench of the Tribunal wherein identical issue has been decided in favour of the assessee, namely, ITA No. 5169/Del/2004 in the case of ITO v. Lakhvinder Singh; ITA No. 5175/Del/2004 in the case of Asstt. CIT v. M/s G.S. Exports; Asstt. CIT v. Anand International in ITA No. 4493/D/2004 dt. 13th May, 2005; Asstt. CIT v. Vipin Saidana in ITA No. 5174/D/2004, dt. 17th June, 2005 and ITO v. Esskay Enterprises in ITA No. 4500/D/2004 dt. 28th June, 2005. Apart from the aforesaid, reliance has also been placed upon the decision in the case of CIT v. Indian Gelatine & Chemicals Ltd. (2005) 194 CTR (Guj) 492 : (2005) 275 ITR 274 (Guj). It is further submitted that the Gujarat High Court has considered the judgment of the apex Court in the case of Sterling Foods (supra).
5. I have considered the rival stands in the light of the precedents cited before me. The decision of the Delhi Bench of the Tribunal in ITA Nos. 5169 and 5175 dt. 28th Sept., 2005 (supra) is the latest decision which has taken into consideration all the judgments being relied upon by the Department before me. It is not in dispute that the Tribunal decided an identical issue as is before me in the instant case. The controversy has been resolved in favour of the assessee after noticing the aforesaid judgments. Therefore, having regard to the necessity to maintain consistency and concurring with the precedent decided by the co ordinate Bench of the Tribunal, I am inclined to affirm the decision of the CIT(A) in the instant case. Moreover, the Tribunal in ITA Nos. 5169 and 5175 (supra) has also discussed in detail the phraseology of Section 80-IB and its difference vis-a- vis Section 80-1 of the Act. Section 80-I was considered by the Hon’ble High Court in the case of Ritesh Industries Ltd. (supra). After noticing the phraseology of Section 80-I and 80-IB, the Tribunal concludes that the concept of profits envisaged under Section 80-IB is wider than the concept of profit envisaged in Section 80-I. On account of this, the Tribunal has concluded that the legal position would be different in the case governed by Section 80-IB in distinction to those falling in 80-I.I, therefore, relying on the precedents noted above, decide the issue in favour of the assessee and against the Department.
6. Before I part, I may also mention that a decision in the case of Liberty India in ITA No. 543/D/2004 dt. 28th June, 2005 by Delhi SMC Tribunal has been brought to my notice wherein the identical issue has been decided in favour of the Revenue. Learned counsel for the respondent fairly conceded that the decision in the case of Liberty India (supra) was against the assessee. However, according to the learned counsel, the said decision was entirely based on the decision of the Delhi High Court in the case of Ritesh Industries Ltd. (supra) and that it has proceeded, perhaps inadvertently, on the basis that the said decision was of a jurisdictional High Court. Whereas the case in question pertained to the State of Haryana and therefore, the jurisdictional High Court was of Punjab & Haryana and not Delhi High Court.
7. I have perused the decision of the Tribunal by SMC Bench in the case of Liberty India dt. 28th June, 2004 (supra). Evidently, the earlier decisions of the Tribunal namely, in the case of Anand International dt. 13th May, 2005 (supra); Vipin Sardana dt. 16th June, 2005 (supra) and Esskay Enterprises dt. 28th June, 2005 (supra) were not brought to the notice of the Bench. Therefore, the earlier decisions of the Tribunal are, to be followed at this stage, specially as the Tribunal in its latest decision in the case of Lakhvinder Singh (supra) dt. 28th Sept., 2005 has decided the issue in favour of the assessee. Moreover, the Division Bench of Delhi Bench of the Tribunal in the case of Vipin Sardana (supra) has been followed by the Tribunal in Lakhvinder Singh (supra). I, therefore, with utmost respect depart from the decision of the Tribunal in the case of Liberty India (supra) and to maintain consistency and judicial discipline decide the issue in favour of the assessee by concurring with the decisions of the co-ordinate Bench of the Tribunal which have held the issue in favour of the assessee in preference to the decision of the Tribunal in the case of Liberty India dt. 28th June, 2004. Moreover, it is also a settled judicial position, that where there are two views, a view which is favourable to the assessee be preferred. On this count, since there are divergent views of my co-ordinate Bench, I prefer the view which is in favour of the assessee.
8. In the result, appeal of the Revenue is dismissed.