THE DCIT RG 3(1), MUMBAI V. M/S. AMBUJA CEMENTS LTD ( FORMERLYY KNOWN AS GUJARAT AMBUJA CEMENTS LTD), MUMBAI

CO 222/MUM/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9887 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 4 month(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 06-01-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2004-2005
• Appeal Filed On: 05-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANADI VARMA LD; HARSHAD VENGURLEKARLD
• Assessee Lawyers: CHAITANYA JOSHI LD A; YOGESH THAR HARDIK NIRMAL
• Keywords: Business income; Depreciation; Opportunity of being heard; Additional evidence; Corroborative evidences; Capital receipt; Revenue expenditure; Capital expenditure; Set aside
• Section: 43B; 143(3); 80HHC; 234B; 14A; 115JB; 37(1); 2(A); 13

Judgement Text

AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI , , BEFORE HONBLE SHRI MAHAVIR SINGH, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM ./ I.T.A. NO.7486/MUM/2007 ( / ASSESSMENT YEAR:2004-05) A CIT - (LTU) - 1 WORLD TRADE CENTRE CENTRE-1, 29 TH FLOOR, CUFFE PARADE, MUMBAI-05. / VS. AMBUJA CEMENTS LIMITED [EARLIER KNOWN AS GUJARAT AMBUJA CEMENTS LTD.] ELEGANT BUSINESS PARK MIDC CROSS ROAD B, OFF ANDHERI-KURLA ROAD ANDHERI (E), MUMBAI-400 059. :; ./ ./PAN/GIR NO. AAACG-0569-P ( ;= /APPELLANT ) : ( >?;= / RESPONDENT ) & ./ I.T.A. NO.7494/MUM/2007 ( / ASSESSMENT YEAR:2004-05) AMBUJA CEMENTS LIMITED [EARLIER KNOWN AS GUJARAT AMBUJA CEMENTS LTD] ELEGANT BUSINESS PARK MIDC CROSS ROAD B, OFF ANDHERI-KURLA ROAD ANDHERI (E), MUMBAI-400 059. / VS. D CIT RANGE - 3(1) AAYKAR BHAVAN, M.K. ROAD MUMBAI-400 020. :; ./ ./PAN/GIR NO. AAACG 0569 P ( ;= /APPELLANT ) : ( >?;= / RESPONDENT ) & C.O. NO.222/MUM/2017 [ARISING OUT OF ITA NO. 7494/MUM/2007] ( / ASSESSMENT YEAR:2004-05) A CIT - (LTU) - 1 WORLD TRADE CENTRE CENTRE-1, 29 TH FLOOR, CUFFE PARADE, MUMBAI-05. / VS. AMBUJA CEMENTS LIMITED [EARLIER KNOWN AS GUJARAT AMBUJA CEMENTS LTD.] ELEGANT BUSINESS PARK MIDC CROSS ROAD B, OFF ANDHERI-KURLA ROAD ANDHERI (E), MUMBAI-400 059. :; ./ ./PAN/GIR NO. AAACG-0569-P ( ;= /APPELLANT ) : ( >?;= / RESPONDENT ) REVENUE BY : SHRI ANADI VARMA-LD.CIT-DR & SHRI HARSHAD VENGURLEKAR-LD. DR ASSESSEE BY : S/SHRI YOGESH THAR, HARDIK NIRMAL & CHAITANYA JOSHI - LD. ARS AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 2 / DATE OF HEARING : 29/11/2019 / DATE OF PRONOUNCEMENT : 06/01/2020 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1.1 AFORESAID CROSS-APPEALS FOR ASSESSMENT YEAR [IN SHORT REFERRED TO AS AY] 2004-05 CONTEST THE ORDER OF LD. COMMISSIO NER OF INCOME-TAX (APPEALS)-XXVII, MUMBAI, [IN SHORT REFERRED TO AS CIT(A)], APPEAL NO. CIT(A)-XXVII/DC-3(1)/133/05-06 DATED 24/09/2007 ON CERTAIN GROUNDS OF APPEAL. AGAINST ASSESSEES APPEAL, THE REVENUE HAS PREFERRED CROSS- OBJECTIONS IN VIEW OF THE FACT THAT THE ASSESSEE HA S PREFERRED ADDITIONAL GROUND & ADDITIONAL EVIDENCES VIDE LETTER DATED 15/ 05/2017. ALTHOUGH THE REGISTRY HAS NOTED A DELAY OF 3573 DAYS IN FILING O F CROSS-OBJECTIONS BY THE DEPARTMENT, HOWEVER, IT HAS BEEN EXPLAINED THAT THE SAID CROSS- OBJECTIONS ARISES OUT OF ADDITIONAL GROUNDS FILED B Y THE ASSESSEE ON 15/05/2017 AND THEREFORE, COUNTING FROM THE DATE OF RECEIPT OF ADDITIONAL GROUND, THE DELAY IS ONLY FOR 63 DAYS. THE CONDONAT ION OF THE SAME HAS BEEN SOUGHT BY THE REVENUE ON THE STRENGTH OF CONDO NATION PETITION DATED 22/08/2017 EXPLAINING THE FACTS THAT LED TO D ELAY. THE DELAY HAS BEEN ATTRIBUTED TO ANNUAL GENERAL TRANSFER AND CHAN GE OF INCUMBENCY IN LARGE TAXPAYER UNIT [LTU]. FINDING THE REASONS TO B E PLAUSIBLE ONE, THE BENCH FORMED AN OPINION THAT THE DELAY WAS TO BE CO NDONED AND THE MATTER WAS TO BE PROCEEDED ON MERITS. 1.2 THE NAME OF ERSTWHILE ENTITY NAMELY GUJARAT AMBUJA CEMENT LTD. HAS UNDERGONE CHANGE TO M/S AMBUJA CEMENTS LTD. AND ACCORDINGLY, AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 3 REVISED APPEAL MEMO HAS BEEN FILED BY THE REVENUE. FINDING THE SAME IN ORDER, WE PROCEED TO ADJUDICATE THE SAME. 1.3 THE ASSESSEE BEING RESIDENT CORPORATE ASSESSEE STATED TO BE ENGAGED IN MANUFACTURING OF CEMENT WAS ASSESSED U/S . 143(3) OF THE ACT ON 30/09/2005 WHEREIN THE INCOME OF THE ASSESSE E WAS DETERMINED AT RS.90.25 CRORES UNDER NORMAL PROVISIONS AFTER CE RTAIN ADDITIONS / DISALLOWANCES AS AGAINST RETURNED INCOME OF RS.62.9 2 CRORES FILED BY THE ASSESSEE ON 27/10/2004. THE BOOK PROFIT U/S 115 JB WERE ASSESSED AT RS.338.39 CRORES AS AGAINST RS.303.13 CRORES OFF ERED BY THE ASSESSEE IN THE RETURN OF INCOME. 1.4 THE LD. AUTHORIZED REPRESENTATIVE FOR ASSESSEE, AT THE OUTSET, PLACED ON RECORD A CHART TO SUBMIT THAT SUBSTANTIAL ISSUES ARE COVERED BY EARLIER ORDERS OF THE TRIBUNAL & HIGHER JUDICIAL AU THORITIES IN ASSESSEES OWN CASE AND FACTS BEING PARI-MATERIA THE SAME, SIM ILAR VIEW MAY BE TAKEN IN THE MATTER. BOTH THE REPRESENTATIVES BROAD LY CONVERGE ON THIS POINT. THE COPIES OF THE VARIOUS ORDERS HAVE BEEN P LACED ON RECORD, WHICH WE HAVE CONSIDERED. THE LATEST ORDER HAS BEEN PASSED BY TRIBUNAL IN CROSS-APPEALS / OBJECTIONS FOR AYS 2002 -03 & 2003-04 VIDE ITA NOS.7092/MUM/2015 & ORS., COMMON ORDER DATED 10 /08/2018. 1.5 THE DECISIONS RENDERED IN ASSESSEES OWN CASE F OR VARIOUS ASSESSMENT YEARS, FOR EASE OF REFERENCE, COULD BE T ABULATED IN THE FOLLOWING MANNER: - NO. CITATION APPEAL BY AY DATE OF ORDER 1. ITA NO.3733/MUM/1996 ASSESSEE 1988-89 03/06/200 5 2. ITA NO.2690/MUM/1993 & ORS. CROSS-APPEALS 1989-9 0 20/12/2002 3. ITA NO.2292/MUM/1993 & ORS. CROSS-APPEALS 1990-9 1 04/08/2003 4. ITA NO.4189/MUM/1996 REVENUE 1992-93 03/11/2003 5. ITA NO.4035/MUM/1996 ASSESSEE 1992-93 29/06/200 6 6. ITA NO.1327/MUM/1999 REVENUE 1993-94 27/10/2004 7. ITA NO.1577/MUM/1999 ASSESSEE 1993-94 27/10/200 4 AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 4 8. ITA NO.4032/MUM/1999 REVENUE 1994-95 09/06/2005 9 ITA NO.4086/MUM/1999 ASSESSEE 1994-95 24/02/2006 10. ITA NO.233/MUM/2004 ASSESSEE 1994-95 27/02/200 8 11. ITA NO.942 & ORS. CROSS-APPEALS 1995-96 & 1996- 97 27/10/2008 12 ITA NO.1859/MUM/2004 & ORS. CROSS-APPEALS 1997-9 8 15/05/2009 13. ITA NO.2654/MUM/2005 & ORS. CROSS-APPEALS 1998- 99 05/08/2016 14. ITA NO.2653/MUM/2005 & ORS. CROSS-APPEALS 1999- 00 30/05/2016 15. ITA NO.4373/MUM/2005 & ORS. CROSS-APPEALS 2000- 01 21/10/2016 16. ITA NO.4374/MUM/2005 & ORS. CROSS-APPEALS 2001- 02 18/01/2017 17. ITA NOS.7092/M/2005 & ORS. CROSS-APPEALS 2002-0 3 & 2003- 04 10/08/2018 18. HONBLE HIGH COURT ITA (L) NO.2401 OF 2007 REVENUE 1988-89 22/04/008 19. HON'BLE SUPREME COURT SLP(CIVIL) NO.2822/2009 REVENUE 1988-89 17/07/2009 20. ORDER OF HON'BLE HIGH COURT ITA NO.936 OF 2003 REVENUE 1989-90 16/04/2007 21. ORDER OF HON'BLE HIGH COURT ITA NO.6186 OF 2010 REVENUE 1995-96 22/10/2012 22. ORDER OF HON'BLE HIGH COURT ITA NO.6195 OF 2010 REVENUE 1996-97 22/10/2012 23. ORDER OF HON'BLE HIGH COURT ITA NO.2176 OF 2010 REVENUE 1997-98 22/10/2012 1.6 IN THE ABOVE BACKGROUND, WE PROCEED TO ADJUDICA TE THE REVENUES APPEAL ITA NO.7486/MUM/2007. THE GROUND RAISED BY R EVENUE READ AS UNDER: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF COMMUNITY WELFARE EXPE NSES OF RS.48,71,746/-. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF TEMPLE EXPENSE OF RS. 6,85,908/- 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF PRIOR YEAR'S EXPENSES OF RS.58,16,022/-. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION ON MINES PROSPECTING EXPENSES OF RS.32,38,016/-. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE TAXES ON FOREIGN EXCHANGE GAIN OF RS. 43,52,74,643/-. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF EMPLOYEES STOCK OPTIO N EXPENSES OF RS.4,51,821/-. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF EXPENSES ON POWERLINE, MARINE STRUCTURE, ROAD AND RAILWAY SIDINGS AMOUNTING TO RS.1,08,416/-, RS.20,0 0,000/- AND RS.2,09,15,649/- RESPECTIVELY.' 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN RESTRICTING THE DISALLOWANCE MADE U/S 14A OF THE I. T. ACT TO RS. 50,000/- AS AGAINST AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 5 RS. 21,65,213/- MADE BY THE AO FOR THE EXPENSES INC URRED IN EARNING THE DIVIDEND INCOME BEING EXEMPT UNDER THE I.T. ACT. 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CLT(A) IN DELETING THE DISALLOWANCE U/S 35D REGARDING PRELIMI NARY EXPENSES OF RS. 19,89,83,520/- AND RS. 41,74,223/- FOR A.YRS. 2001- 02 & 2002-03 RESPECTIVELY. 10. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) ERRED IN DIRECTING THE AO TO INCLUDE THE EXCISE DUTY AND SAL ES TAX AMOUNTING TO RS.334,52,74,729/- AND RS. 72,34,31,000/- RESPECTIV ELY IN THE TOTAL TURNOVER FOR THE PURPOSE OF COMPUTATION OF DEDUCTION U/S 80HHC. 11. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) ERRED IN ALLOWING CREDIT FOR MAT PAID U/S 115JA FOR THE PURP OSE OF CHARGING INTEREST U/S 234B. 12. THE APPELLANT PRAYS THAT THE ORDER OF CIT(A) O N THE ABOVE GROUNDS TO SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 13. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER A NY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. OUR ADJUDICATION TO THESE GROUNDS WOULD BE AS FOLLO WS: - 2.1 GR. NO.1: DELETION OF DISALLOWANCE OF COMMUNITY WELFARE EXPENSES FOR RS.48.71 LACS THESE EXPENSES WERE STATED TO BE INCURRED BY THE AS SESSEE TOWARDS SMOOTH FUNCTIONING OF THE FACTORY AND TO ENABLE THE EMPLOYEES STAYING IN THE FACTORY TO AVAIL THE BASIC NEEDS. DURING ASSESS MENT PROCEEDINGS, THE ATTENTION WAS DRAWN TO THE FACT THAT SIMILAR EXPENS ES INCURRED BY ASSESSEE IN AYS 1989-90 & 1990-91 WERE ALLOWED BY T RIBUNAL. THE SAID DECISION WAS FOLLOWED BY TRIBUNAL IN AY 1993-94. HO WEVER, FINDING THAT THE DEPARTMENT WAS UNDER APPEAL BEFORE HIGH COURT A GAINST THE DECISION OF THE TRIBUNAL, THE SAID EXPENDITURE WAS DISALLOWE D BY LD. AO. THE LEARNED CIT(A) DELETED THE SAME BY FOLLOWING TH E TRIBUNAL ORDER FOR AYS 1989-90 & 1990-91. IT WAS OBSERVED THAT FOLLOWI NG TRIBUNAL ORDER, SIMILAR VIEW WAS TAKEN BY FIRST APPELLATE AUTHORITI ES IN AYS 1995-96 TO 2003-04. IT IS ADMITTED POSITION BEFORE US THAT THE DEPARTMENTAL APPEAL, ON THIS ISSUE, AGAINST APPELLATE ORDERS FOR AYS 199 5-96 TO 2003-04 HAS BEEN DISMISSED BY THE TRIBUNAL. FURTHER, THE QUESTI ON ON THIS ISSUE RAISED BY THE DEPARTMENT FOR AYS 1988-89 & 1989-90 WAS NOT ADMITTED AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 6 BY HONBLE BOMBAY HIGH COURT. NO APPEAL HAS BEEN PR EFERRED BY THE DEPARTMENT ON THIS ISSUE BEFORE HONBLE HIGH COURT FOR AYS 1990-91, 1991-92 & 1993-94. THEREFORE, RESPECTFULLY FOLLOWIN G THE CONSISTENT STAND OF TRIBUNAL, WE DISMISS THIS GROUND OF APPEAL . 2.2 GR. NO.2: DELETION OF DISALLOWANCE OF TEMPLE EX P. FOR RS.6.85 LACS THESE EXPENSES WERE STATED TO BE INCURRED ON TEMPLE FOR THE PURPOSE OF EMPLOYEES STAYING IN THE ASSESSEES FACTORY. THE AT TENTION WAS DRAWN TO THE FACT THAT SIMILAR EXPENSES INCURRED BY ASSESSEE IN AYS 1989-90 & 1990-91 WERE ALLOWED BY TRIBUNAL. THE SAID DECISION WAS FOLLOWED IN AY 1993-94. HOWEVER, FINDING THAT THE DEPARTMENT WAS U NDER APPEAL BEFORE HIGH COURT AGAINST THE DECISION OF THE TRIBUNAL, TH E SAID EXPENDITURE WAS DISALLOWED. THE LEARNED FIRST APPELLATE AUTHORITY DELETED THE S AME BY FOLLOWING THE ORDER OF TRIBUNAL FOR AYS 1998-99 TO 2002-03. IT IS ADMITTED POSITION THAT THIS ISSUE IS SQUARELY COVERED BY EARLIER DECISIONS OF TRIBUNAL RIGHT UP-TO AY 2003-04. NO APPEAL HAS BEEN PREFERRED BY THE DEP ARTMENT ON THIS ISSUE BEFORE HONBLE HIGH COURT FOR AYS 1990-91, 19 91-92 & 1993-94. WE FIND THAT THIS QUESTION RAISED BY THE REVENUE BE FORE HONBLE HIGH COURT HAS BEEN ADMITTED IN FEW EARLIER YEARS, HOWEV ER, THE SAME IS STILL PENDING FOR ADJUDICATION VIDE ITA NO. 6186 OF 2010, ITA NO. 6195 OF 2010 & ITA NO. 660 OF 2011. THEREFORE, AS OF NOW, T HE ISSUE IS COVERED IN ASSESSEES FAVOR BY THE EARLIER DECISIONS OF THE TRIBUNAL. RESPECTFULLY FOLLOWING THE SAME, WE DISMISS THIS GROUND OF APPEA L. 2.3 GR. NO.3: DELETION OF DISALLOWANCE OF PRIOR YEA RS EXPENSES FOR RS.58.16 LACS AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 7 THE TAX AUDIT REPORT FOR THE YEAR UNDER CONSIDERATI ON REPORTED THAT THE ASSESSEE DEBITED PREVIOUS YEARS EXPENSES OF RS.58.1 6 LACS IN THE PROFIT & LOSS ACCOUNT. THE ASSESSEE DEFENDED THE SAME BY S UBMITTING THAT THE SAID EXPENDITURE CRYSTALIZED DURING THE YEAR AN D AROSE DUE TO LATE SUBMISSION OF BILLS BY PARTIES, DISPUTED BILLS SETT LED IN CURRENT YEAR, SHORT PROVISIONS ETC. IT WAS SUBMITTED THAT SIMILAR CLAIM WAS ALLOWED BY FIRST APPELLATE AUTHORITY IN AYS 1989-90 TO 1991-92 AND U PON REVENUES APPEAL, THE TRIBUNAL RESTORED THE MATTER BACK TO TH E FILE OF LD. AO SINCE SUPPORTING EVIDENCES WERE NOT AVAILABLE. HOWEVER, T HE SAID PLEA WAS REJECTED BY LD. AO AND THE EXPENDITURE WAS DISALLOW ED. THE LD. CIT(A) OBSERVED THAT THIS ISSUE WAS ALLOWED BY FIRST APPELLATE AUTHORITIES IN AYS 1995-96 TO 2002-03. UPON PERUSAL OF DETAILS SUBMITTED BY THE ASSESSEE, THE LD. CIT(A) HELD THAT THE SAID EXPENDITURE HAD CRYSTALIZED DURING THE YEAR AND THEREFORE, THE SAME WAS AN ALLOWABLE DEDUCTION. WE FIND THAT THIS ISSUE IS SQUARELY COVERED BY THE DECISION OF TRIBUNAL FOR AYS 2002-03 & 2003-04, COMMON ORDER DATED 10/08/201 8. THE TRIBUNAL CONFIRMED THE STAND OF LD. CIT(A) IN VIEW OF THE CL EAR FINDING THAT THE EXPENSES HAD CRYSTALIZED DURING THE YEAR. SIMILAR F INDINGS HAVE BEEN GIVEN BY LEARNED FIRST APPELLATE AUTHORITY IN THIS YEAR. THEREFORE, RESPECTFULLY, FOLLOWING THE SAME, WE DISMISS THIS G ROUND OF APPEAL. 2.4 GR. NO.4: DELETION OF DISALLOWANCE OF MINES PRO SPECTING EXPENSES FOR RS.32.38 LACS THE SAID EXPENDITURE WAS STATED TO BE INCURRED ON V ARIOUS SITE LOCATIONS TO CHECK THE AVAILABILITY OF LIMESTONE WHICH WAS MA JOR RAW MATERIAL FOR MANUFACTURING OF CEMENT. IT WAS PLEADED THAT SIMILA R EXPENDITURE WAS AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 8 ALLOWED BY TRIBUNAL FOR AYS 1989-90 WHICH WAS FOLLO WED IN 1990-91 AND SIMILAR CLAIM WAS ALLOWED IN AY 1994-95 ALSO. HOWEV ER, FINDING THE DEPARTMENT WAS UNDER APPEAL TO HONBLE HIGH COURT A GAINST THE DECISION OF TRIBUNAL FOR AYS 1989-90 & 1990-91, THE SAID EXP ENDITURE WAS DISALLOWED, BEING CAPITAL IN NATURE. SINCE NO NEW A SSET WAS CREATED, THE DEPRECIATION ON THE SAME WAS ALSO DENIED TO THE ASS ESSEE. THE LEARNED FIRST APPELLATE AUTHORITY, FOLLOWING AP PELLATE ORDERS OF EARLIER YEARS, DELETED THE SAME. WE FIND THAT THIS ISSUE IS SQUARELY COVERED IN ASSE SSEES FAVOR RIGHT UP-TO AY 2003-04. THE REVENUE HAS CHOSEN NOT TO FILE APPE AL ON THIS GROUND BEFORE HONBLE HIGH COURT FOR AY 1989-90 & 1994-95 WHEREAS THIS QUESTION HAS NOT ADMITTED BY HONBLE COURT IN AYS 1 988-89, 1995-96 TO 1997-98. RESPECTFULLY FOLLOWING THE CONSISTENT VIEW , THIS GROUND STAND DISMISSED. 2.5 GR. NO.5: FOREIGN EXCHANGE GAINS FOR RS.4352.74 LACS THE ASSESSEE OFFERED FOREIGN EXCHANGE GAIN OF RS.43 52.74 LACS IN THE PROFIT & LOSS ACCOUNT. TILL AY 2002-03, THE ASSESSE E CLAIMED DEDUCTION OF FOREX LOSS WHICH WAS DENIED TO THE ASSESSEE TREA TING IT AS A NOTIONAL LOSS. THEREFORE, THE ASSESSEE SUBMITTED THAT THE GA IN SHOULD ALSO NOT BE TAXED SINCE THE CLAIM OF NOTIONAL LOSS WAS NOT ACCE PTED BY THE DEPARTMENT IN EARLIER YEARS. HOWEVER, THE SAID PLEA COULD NOT FIND FAVOR WITH LD. AO WHO DENIED THE ADJUSTMENT OF THE SAME. THE LEARNED FIRST APPELLATE AUTHORITY CONFIRMED THE SAME SINCE FOREX LOSS DISALLOWANCE MADE IN EARLIER YEARS WAS DELETED IN T HOSE YEARS AND THEREFORE, THE GAIN WOULD BE FULLY TAXABLE. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 9 WE FIND THAT THIS ISSUE IS ALREADY DECIDED AGAINST THE ASSESSEE BY LD. CIT(A) AND THEREFORE, THERE COULD BE NO OCCASION OF GRIEVANCE FOR REVENUE. CONSEQUENTLY, THIS GROUND STAND DISMISSED AS BEING INFRUCTUOUS. 2.6 GR. NO.6: DELETION OF DISALLOWANCE OF EMPLOYEES STOCK OPTION EXPENSES FOR RS.4.51 LACS THE ASSESSEE CREDITED A SUM OF RS.1.10 LACS, BEING EMPLOYEES REMUNERATION AND BENEFITS ACCOUNT SINCE EXPENDITUR E ON THIS ACCOUNT IN EARLIER YEARS WAS CLAIMED AS EXPENSE / LOSS. HOWEVE R, IT WAS NOTED BY LD. AO THAT DEDUCTION CLAIMED FOR AYS 2000-01 TO 20 03-04 WAS DENIED CONSIDERING THE SAME TO BE NOTIONAL LOSS AND THEREF ORE, THE GAINS SHOULD BE DEDUCTED FROM THE TOTAL INCOME. FURTHER, DURING THE YEAR 372425 SHARES WERE ACTUALLY EXERCISED BY THE EMPLOYEES AND THEREFORE, THE PROPORTIONATE AMOUNT OF RS.4.51 LACS WOULD BE ALLOW ABLE TO THE ASSESSEE. FINDING THE SAME IN ORDER, THE SAID AMOUN T WAS ALSO REDUCED FROM TOTAL INCOME. IN OTHER WORDS, AGGREGATE AMOUNT OF RS.5.62 LACS WAS REDUCED FROM TOTAL INCOME. THIS GROUND WAS NOT PRESSED BY ASSESSEE BEFORE LEARNED FIRST APPELLATE AUTHORITY. UPON PERUSAL OF TRIBUNAL ORDER FOR AY 2003-04, IT T RANSPIRES THAT ESOP EXPENDITURE HAS FULLY BEEN ALLOWED AS PER THE CLAIM OF THE ASSESSEE. IN OTHER WORDS, THE ASSESSEE HAS BEEN ALLOWED ESOP EXP ENSES AS CLAIMED IN THE PROFIT & LOSS ACCOUNT AND THEREFORE, THE RESULTANT SURPLUS / GAINS WOULD BE FULLY TAXABLE, APPLYING THE SAME A NALOGY. ACCORDINGLY, THE REDUCTION OF INCOME BY RS.5.62 LACS (INCLUDING SURPLUS OF RS.1.10 LACS) AS DONE BY LD. AO WOULD NOT BE WARRANTED. WE DIRECT LD. AO NOT TO REDUCE THE TOTAL INCOME BY RS.5.62 LACS. WE FIND THAT THIS GROUND IS AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 10 BADLY DRAFTED SINCE THERE WAS NO DISALLOWANCE MADE BY LD. AO BUT, IN FACT, A RELIEF WAS GRANTED TO THE ASSESSEE. NEVERTH ELESS, TO SETTLE THE THINGS AS PER EARLIER DECISIONS, WE DIRECT LD. AO N OT TO REDUCE THE TOTAL INCOME BY RS.5.62 LACS. THIS GROUND MAY BE DEEMED T O BE ALLOWED. 2.7 GR. NO.7: DELETION OF DISALLOWANCE OF EXPENSES ON POWERLINE, MARINE STRUCTURE, ROAD & RAILWAY SIDINGS FOR RS.1.08 LACS, RS. 20 LACS & RS.209.15 LACS RESPECTIVELY THE ASSESSEE CLAIMED THESE EXPENDITURE U/S 37(1) BY SUBMITTING THAT THE OWNERSHIP OF POWERLINE, MARINE STRUCTURES AND ROAD DO NOT BELONG TO THE COMPANY BUT BELONG TO GOVERNMENT AUTHORITIES AND TH EREFORE, THE EXPENDITURE WAS AN ALLOWABLE REVENUE EXPENDITURE. H OWEVER, THE DEDUCTION OF THE SAME WAS DENIED TREATING THE EXPEN DITURE TO BE CAPITAL IN NATURE AND SINCE NO NEW ASSET WAS CREATED, DEPRE CIATION WAS ALSO DENIED. THE LD. CIT(A), FOLLOWING THE ORDER OF ITS PREDECESSOR FOR AYS 1995-96 AND 2002-03, GRANTED RELIEF TO THE ASSESSEE . WE FIND THAT TRIBUNAL CONFIRMED THE ORDER OF FIRST APPELLATE AUTHORITY FOR AY 2002-03 FOLLOWING THE DECISION OF TRIBUNAL IN AY 2001-02. THEREFORE, RESPECTFULLY FOLLOWING THE CONSISTENT STAND OF TRIB UNAL, WE DISMISS THIS GROUND OF APPEAL. 2.8 GR. NO.8: RESTRICTION OF DISALLOWANCE U/S 14A F ROM RS.21.65 LACS TO RS.0.50 LACS THE ASSESSEE EARNED EXEMPT DIVIDEND INCOME OF RS.10 7.60 LACS WHICH LED THE LD. AO TO INVOKE DISALLOWANCE U/S 14A. THE LD. AO, AS DONE IN EARLIER YEARS, ESTIMATED THE DISALLOWANCE @2% WHICH RESULTE D INTO ADDITION OF RS.2.15 LACS IN THE HANDS OF THE ASSESSEE. UPON FUR THER APPEAL, LD. CIT(A) ESTIMATED THE SAME AT RS.0.50 LACS. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 11 WE FIND THAT IN AY 2002-03, TRIBUNAL HAS CONFIRMED THE ESTIMATION OF RS.2 LACS AS MADE BY LD. CIT(A), FINDING THE SAME TO BE FAIR AND REASONABLE. APPLYING THE SAME LOGIC, WE DISMISS THIS GROUND OF APPEAL. 2.9 GR. NO.9: DELETION OF DISALLOWANCE U/S 35D BEIN G PRELIMINARY EXPENSES OF RS.1989.83 LACS & RS.41.74 LACS FOR AYS 2001-02 & 2002-03 RESPECTIVELY WE FIND THAT THIS GROUND IS WRONGLY DRAFTED SINCE T HE PERUSAL OF QUANTUM ASSESSMENT ORDER WOULD REVEAL THAT THE ASSESSEE HAS BEEN SADDLED WITH DISALLOWANCE OF RS.406.31 LACS ONLY U/S 35D, BEING 1/5 TH OF EXPENDITURE INCURRED ON ISSUE OF FOREIGN CURRENCY CONVERTIBLE B ONDS. THE EXPENSES WERE STATED TO HAVE BEEN INCURRED IN AYS 2001-02 & 2002-03 AND DISALLOWED IN THOSE YEARS RELYING UPON THE DECISION OF APEX COURT IN KODAK INDIA LTD. (253 ITR 445). THEREFORE, THE SAME WERE DISALLOWED IN THIS YEAR ALSO. THE LD. CIT(A) ALLOWED THE SAME SINCE IN EARLIER AY S, IT WAS HELD BY FIRST APPELLATE AUTHORITIES THAT THE EXPENSES WERE INCURR ED FOR EXTENSION OF BUSINESS AND THEREFORE COVERED BY SEC. 35D(2) OF TH E ACT. HOWEVER, IT WAS HELD THAT THE DEDUCTION WOULD START FROM YEAR I N WHICH THE PROJECT STARTS COMMERCIAL PRODUCTION. SINCE, THE PROJECT HA D STARTED COMMERCIAL PRODUCTION IN JUNE, 2002, THE DEDUCTION OF THE SAME WOULD BE ALLOWABLE TO THE ASSESSEE. WE FIND THAT SIMILAR GROUND RAISED BY THE REVENUE I N AYS 2002-03 HAS BEEN DISMISSED BY THE TRIBUNAL. THEREFORE, FOLLOWIN G THE SAME, WE DISMISS THIS GROUND OF APPEAL. 2.10 GR. NO.10: INCLUSION OF EXCISE DUTY AND SALES TAX A MOUNTING TO RS.334.52 CRORES AND RS.72.34 CRORES IN TOTAL TURNO VER FOR THE PURPOSE OF COMPUTATION U/S 80HHC AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 12 THE ASSESSEE CLAIMED DEDUCTION U/S 80HHC FOR RS.717 .50 LACS ON THE STRENGTH OF ACCOUNTANTS CERTIFICATE. UPON PERUSAL OF WORKING, IT WAS NOTED THAT EXCISE DUTY FOR RS.334.52 CRORES WAS EXC LUDED FROM GROSS TURNOVER. SIMILARLY, SALES TAX OF RS.72.34 CRORES W AS NOT PASSED THROUGH PROFIT & LOSS ACCOUNT. THE LD. AO, REFERRIN G TO PROVISIONS OF SEC. 145A, HELD THAT THESE TWO ITEMS WOULD BE INCLU DIBLE WHILE WORKING OUT THE DEDUCTION. THE WORKING IN THE AFORESAID MAN NER REDUCED THE DEDUCTION U/S 80HHC TO RS.558.39 LACS. THE LEARNED CIT(A) FOLLOWING THE DECISION IN AYS 2000-01 TO 2002-03, DIRECTED FO R EXCLUSION OF THESE TWO ITEMS WHILE COMPUTING DEDUCTION U/S 80HHC. WE FIND THAT TRIBUNAL DISMISSED SIMILAR GROUND RAIS ED BY REVENUE IN AY 2002-03 BY FOLLOWING THE ORDER FOR AY 2001-02 AND U PHELD THE STAND OF LD. CIT(A). FACTS BEING PARI-MATERIA THE SAME, FOLL OWING CONSISTENT VIEW OF THE TRIBUNAL IN EARLIER YEARS, WE CONFIRM THE ST AND OF LD. CIT(A) AND DISMISS THIS GROUND OF APPEAL. 2.11 GR. NO.11: CREDIT FOR MAT FOR THE PURPOSES OF CHARGING INTEREST U/S 234B FROM PERUSAL OF PARAS-23 & 24 OF QUANTUM ASSESSMENT ORDER, IT IS EVIDENT THAT THE TAX PAYABLE ON NORMAL INCOME WAS M ORE THAN TAX PAYABLE ON BOOK PROFITS COMPUTED U/S 115JB AND THEREFORE, THE ASSESSEE HAS PAID NORMAL TAX IN THIS YEAR. THE ASSE SSEE WAS FOUND ELIGIBLE TO CLAIM MAT CREDIT OF RS.585.04 LACS AS P ER SEC.115JAA AND THEREFORE, THE CREDIT OF THE SAME WAS ALLOWED. HOWE VER, INTEREST U/S 234B WAS COMPUTED BEFORE ADJUSTING MAT CREDIT. THE LD. CIT(A), ACCEPTING ASSESSEES SUBMISSIONS AND RELYING UPON V ARIOUS DECISIONS OF AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 13 TRIBUNAL, HELD THAT INTEREST WAS TO BE CHARGED ONLY AFTER ADJUSTMENT OF TAX CREDIT. WE FIND THAT THE ADJUDICATION OF LD. CIT(A) IS IN L INE WITH FOLLOWING BINDING JUDICIAL PRONOUNCEMENTS: - I) CIT V/S TULSYAN NEC LTD. [2011 330 ITR 226(SC)] II) CIT V/S APAR INDUSTRIES LTD. [(2010)323 ITR 411 (BOMBAY HC)] III) CIT V/S SHIV TEXYARN LTD. [(2009) 182 TAXMAN 1 (MADRAS HC)] IV) CIT V/S. GUJARAT MITRA (P.) LTD. [(2013) 214 TA XMAN 35(GUJARAT HC)] V) CHEMPLAST SANMAR LTD. V/S DCIT [(2004) 83 TTJ 42 7 (CHENNAI TRIBUNAL)] VI) PHILLIPS INDIA LTD. V/S. ACIT [(2005) 92 ITD 44 1 (CHANDIGARH TRIBUNAL)] VII) SYNTHETIC IND. CHEMICALS LTD. V/S DCIT [(2004) 270 ITR 98 (COCHIN TRIBUNAL)] VIII) ACIT V/S BSL LTD. [(ITA NO.1757 OF 2005 (KOLK ATTA TRIBUNAL)] IX) ACIT V/S GRAPHITE INDIA LTD. [ITA NO.1176 OF 20 06 (KOLKATTA TRIBUNAL) NO CONTRARY DECISION HAS BEEN PLACED ON RECORD AND THEREFORE, NO INTERFERENCE IS CALLED FOR IN THE IMPUGNED ORDER. T HIS GROUND STAND DISMISSED. 2.12 GROUND NOS. 12 & 13 ARE GENERAL IN NATURE WHIC H DO NOT REQUIRE ANY SPECIFIC ADJUDICATION. 2.13 RESULTANTLY, THE APPEAL STANDS PARTLY ALLOWED TO THE EXTENT AS INDICATED IN THE ORDER. THE LEARNED AO IS DIRECTED TO RECOMPUTE THE INCOME OF THE ASSESSEE IN TERMS OF OUR ADJUDICATION . ASSESSEES APPEAL, ITA NO. 7494/MUM/2007 3. THE GROUNDS RAISED BY THE ASSESSEE READ AS UNDER : - 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [HERE IN AFTER REFERRED TO AS LD. CIT (APPEALS)] WAS NOT JUSTIFIED IN CONFIRMING THE DISA LLOWANCE OF EXPENDITURE INCURRED FOR POOJA/ FUNCTION EXPENSES AMOUNTING TO RS.28,42,057/- BY HOLDING THAT THE SAME WAS NOT INCURRED WHOLLY AND EXCLUSIVE LY FOR THE PURPOSE OF BUSINESS. 2(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(APPEALS) WAS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE OF CONSULTANCY CHARGES AMOUNTING TO RS. 32,52,000/- BY HOLDING THAT THE SA ID EXPENDITURE IS CAPITAL IN NATURE. 2(B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND WITHOUT PREJUDICE TO GROUND NO.2(A), TAKEN HERE-IN-ABOVE, HAVING HELD THAT THE IMPUGNED AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 14 EXPENDITURE IS CAPITAL IN NATURE, THE LD.CLT (APPEA LS) ERRED IN NOT ALLOWING DEPRECIATION ON THE SAME. 3(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(APPEALS) WAS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE OF CHARGES FOR SERVICE AMOUNTING TO RS. 1,93,960/- BY HOLDING THAT THE SAI D EXPENDITURE IS CAPITAL IN NATURE. 3(B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND WITHOUT PREJUDICE TO GROUND NO. 3(A), TAKEN HERE IN ABOVE, HAVING HEL D THAT THE IMPUGNED EXPENDITURE IS CAPITAL IN NATURE, THE LD. CIT(APPEA LS) ERRED IN NOT ALLOWING DEPRECIATION ON THE SAME. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. CIT(APPEALS) ERRED IN NOT EXCLUDING GAIN ON EXCHANGE DUE TO DECR EASE IN RUPEE LIABILITY ON ACCOUNT OF FLUCTUATION IN RATE OF EXCHANGE, FROM THE COMPUTATION OF TOTAL INCOME IRRESPECTIVE OF THE STAND TAKEN BY THE DEPAR TMENT IN EARLIER YEARS TO TREAT THE EXCHANGE LOSS AS NOTIONAL, HENCE NOT ALLO WABLE. 5. THAT ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE LD. CIT(APPEALS) WAS NOT JUSTIFIED IN ESTIMATING RS.50,000/- AS EXPE NSES INCURRED TOWARDS EARNING DIVIDEND INCOME U/S 14A, WHEN NO SUCH EXPEN SES WERE ACTUALLY INCURRED BY THE APPELLANT. 6(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(APPEALS) WAS NOT JUSTIFIED IN CONFIRMING THE DECISION OF THE A.O. IN ASSESSING INTEREST INCOME OF RS. 38,41,56,750/- AND TRUCK HIRE CHARGES OF RS. 2,79,759/- (NET) AS INCOME UNDER THE HEAD 'INCOME FROM OTHER SOURCES '. 6(B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND WITHOUT PREJUDICE TO GROUND NO.6(A) TAKEN HERE-IN-ABOVE, HAVING HELD THAT THE SAID INCOME WERE TO BE ASSESSED UNDER THE HEAD 'INCOME FROM OTHER SO URCES', THE LD. CIT(APPEALS) OUGHT TO HAVE ALLOWED THE ACTUAL EXPEN DITURE INCURRED TO EARN THE AFORESAID INCOME. 6(C) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND WITHOUT PREJUDICE TO GROUND NO. 6(A) & 6(B) TAKEN HERE-IN-ABOVE, HAVI NG HELD THAT TRUCK HIRE CHARGES WERE TO BE ASSESSED UNDER THE HEAD 'INCOME FROM OTHER SOURCES', THE LD. CLT(APPEALS) OUGHT TO HAVE ALLOWED DEPRECIA TION ON TRUCKS. 7(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CLT (APPEALS) WAS NOT JUSTIFIED IN NOT ADMITTING THE ADDITIONAL G ROUND INSPITE OF THE FACT THAT ALL THE MATERIALS FOR ADJUDICATING THE ISSUE WERE A LREADY AVAILABLE ON RECORD. 7(B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND WITHOUT PREJUDICE TO GROUND NO.7(A) TAKEN HERE-IN-ABOVE, THE LD. CLT (APPEALS) WAS NOT JUSTIFIED IN NOT ALLOWING DEDUCTION U/S 35D AMOUNTING TO RS. 82,860/- BEING 1/10TH OF THE TRADABLE WARRANT ISSUE EXPENSES. 8(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(APPEALS) WAS NOT JUSTIFIED IN CONFIRMING DISALLOWANCE OF THE PROPORTIONATE AMOUNT OF PREMIUM ON LEASEHOLD LAND OF RS. 30,73,872/- WRITTE N OFF DURING THE YEAR AS REVENUE EXPENDITURE BY TREATING THE SAME AS CAPITAL EXPENDITURE. 8(B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(APPEALS) FAILED TO APPRECIATE THE FACT THAT THE PREMIUM PAID ON LEASEHOLD LAND, ESSENTIALLY BEARS THE CHARACTER OF RENT PAID IN ADV ANCE WHICH DOES NOT ENTAILS ACQUISITION OF ANY ASSET. 9(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(APPEALS) WAS NOT JUSTIFIED IN CONFIRMING ADDITION OF UNUTILI ZED MODVAT CREDIT AS ON LAST AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 15 DAY OF ACCOUNTING YEAR BEING 31 ST MARCH 2004 AS ADJUSTMENT UNDER SECTION 145A DISREGARDING THE FACT THAT THE APPELLANT HIMSE LF HAS ALREADY CARRIED OUT NECESSARY ADJUSTMENT U/S 145A WHICH WAS DULY CERTIF IED BY TAX AUDITORS AND HENCE ANY FURTHER ADJUSTMENT WAS NOT WARRANTED. 9(B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND WITHOUT PREJUDICE TO THE GROUND NO. 9(A) TAKEN HERE IN ABOVE, EVEN IF ADJUSTMENT U/S 145A IN RESPECT OF UNUTILIZED MODVAT CREDIT IS CARRIED OUT, DEDUCTION FOR THE SAME IS AVAILABLE TO THE APPELLANT UNDER PROVISIONS OF SECT ION 43B SINCE THE APPELLANT HAD PAID EXCISE DUTY PAYABLE ON CLOSING STOCK OF CE MENT AS ON LAST DAY OF ACCOUNTING YEAR BEFORE FILING OF RETURN OF INCOME F OR ASSESSMENT YEAR 2004- 05 BY ADJUSTING UNUTILIZED MODVAT CREDIT AND NECESS ARY PROOFS FOR PAYMENT OF EXCISE DUTY ARE ON THE RECORDS OF ASSESSING OFFI CER. 10. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CLT(APPEALS), WAS NOT JUSTIFIED AND RATHER GROSSLY ERRED IN CONFI RMING THE NON-EXCLUSION OF CAPITAL PROFIT ON SALE OF INVESTMENT AMOUNTING TO R S. 3,11,81,125/- IN COMPUTING BOOK PROFIT AS PER PROVISIONS OF SEC 115J B. 11(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD, CIT(APPEALS) WAS NOT JUSTIFIED AND RATHER GROSSLY ERRED IN NOT A DMITTING THE ADDITIONAL GROUND INSPITE OF THE FACT THAT ALL THE MATERIALS F OR ADJUDICATING THE ISSUE WERE ALREADY AVAILABLE ON RECORD. 11 (B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, AND WITHOUT PREJUDICE TO THE GROUND NO.11(A) TAKEN HERE IN ABOVE, THE LD. CLT(APPEALS) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF DIVIDEND DI STRIBUTION TAX IN COMPUTING BOOK PROF IT U/SLL5JB. 12. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, ON DISPOSAL OF THIS APPEAL, MATERIAL ADJUSTMENTS WOULD BE REQUIRED IN C OMPUTING TOTAL INCOME, DEDUCTION UNDER CHAPTER VIA, BOOK PROFIT, INTEREST, BROUGHT FORWARD AND SET OFF OF MAT CREDIT AND TAX AND NECESSARY DIRECTION MAY B E GIVEN TO THE A.O. ON THIS FRONT. 13. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEN D, MODIFY, RESCIND, SUPPLEMENT, OR ALTER ANY OF THE GROUNDS STATED HERE-IN-ABOVE, E ITHER BEFORE OR AT THE TIME OF HEARING OF THIS APPEAL. OUR ADJUDICATION TO THIS APPEAL WOULD BE AS GIVEN I N SUCCEEDING PARAGRAPHS. 4.1 GR. NO.1: DISALLOWANCE OF PUJA / FUNCTION EXPEN SES FOR RS.28.42 LACS THESE EXPENSES WERE IN THE NATURE OF POOJA EXPENSES INCURRED BY ASSESSEE DURING FESTIVALS. THE ASSESSEE PLEADED FOR ALLOWANCE OF THE SAME RELYING UPON FAVORABLE DECISIONS OF TRIBUNAL F OR AYS 1988-89 TO 1990-91 & 1993-94. HOWEVER, SINCE THE DEPARTMENT WA S UNDER APPEAL AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 16 BEFORE HONBLE HIGH COURT, THE EXPENDITURE WAS DISA LLOWED. THE LEARNED CIT(A), FOLLOWING EARLIER YEARS ORDER OPINED THAT PERFORMING POOJA IN THE TEMPLE WAS PURELY AN INDIVIDUAL MATTER AND THERE CO ULD NOT BE ANY ELEMENT OF STAFF WELFARE IN IT. THEREFORE, THE SAID ITEM WOULD FAIL THE TEST OF SEC. 37(1) AND HENCE, NOT ALLOWABLE. WE FIND THAT THIS ISSUE IN COVERED IN ASSESSEES FA VOR BY THE DECISION OF TRIBUNAL UP-TO AY 2003-04. THE QUESTION RAISED BY R EVENUE, IN THIS REGARD, IN AYS 1989-90 & 1997-98 BEFORE HONBLE HIG H COURT WAS NOT ADMITTED WHEREAS NO FURTHER APPEAL WAS PREFERRED BY REVENUE AGAINST THE ORDER OF TRIBUNAL IN AYS 1988-89 & 1996-97. RES PECTFULLY FOLLOWING THE SAME, WE ALLOW THIS GROUND OF APPEAL. 4.2 GR. NO.2: DISALLOWANCE OF CONSULTANCY CHARGES F OR RS.32.52 LACS THE ASSESSEE CLAIMED DEDUCTION OF SAID SUM WHICH WA S STATED TO BE PAID FOR CIVIL CONSTRUCTION. IT WAS SUBMITTED THAT THE EXPENSES WERE IN THE NATURE OF REPAIRS AND MAINTENANCE OF CIVIL STRUCTUR ES AND HENCE, ALLOWABLE. THE ATTENTION WAS DRAWN TO THE FACT THE SIMILAR EXPENDITURE WAS ALLOWED BY LD. CIT(A) IN EARLIER YEARS. THE ATT ENTION WAS ALSO DRAWN TO FAVORABLE ORDER OF TRIBUNAL FOR AY 1990-91. HOWE VER, SINCE THE DEPARTMENT WAS IN FURTHER APPEAL IN AY 1990-91, THE SAID EXPENDITURE WAS DISALLOWED, HOLDING THE SAME TO BE CAPITAL IN N ATURE. SINCE NO NEW ASSET WAS CREATED, DEPRECIATION WAS ALSO DENIED. TH E LEARNED CIT(A), FOLLOWING THE ORDERS FOR AYS 1995-96 TO 2003-04, HE LD THE SAME TO BE CAPITAL IN NATURE. WE FIND THAT THIS GROUND IS COVERED IN ASSESSEES F AVOR BY THE DECISION OF TRIBUNAL UP-TO AYS 2003-04. NOTHING CONTRARY IS ON RECORD. RESPECTFULLY AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 17 FOLLOWING THE SAME, WE ALLOW THIS GROUND OF APPEAL. CONSEQUENTLY, THE PLEA OF ALLOWANCE OF DEPRECIATION AGAINST THE SAME BECOMES INFRUCTUOUS. 4.3 GR.NO.3: DISALLOWANCE OF SERVICE CHARGES FOR RS .1.93 LACS THE CHARGES REPRESENT SERVICE CHARGES PAID TO SH. L . H.HIRANI. THE ATTENTION WAS DRAWN TO THE FACT THE SIMILAR EXPENDI TURE WAS ALLOWED BY LD. CIT(A) IN EARLIER YEARS UP-TO AY 1994-95. THE A TTENTION WAS ALSO DRAWN TO FAVORABLE ORDER OF TRIBUNAL FOR AY 1992-93 . HOWEVER, DISREGARDING THE SAME, THE EXPENDITURE WAS DISALLOW ED. SINCE NO NEW ASSET WAS CREATED, DEPRECIATION WAS ALSO DENIED. TH E LEARNED CIT(A), FOLLOWING THE ORDERS FOR AYS 1995-96 TO 2003-04, HE LD THE SAME TO BE CAPITAL IN NATURE. WE FIND THAT THIS GROUND IS COVERED IN ASSESSEES F AVOR BY THE DECISION OF TRIBUNAL UP-TO AYS 2003-04. NOTHING CONTRARY IS ON RECORD. RESPECTFULLY FOLLOWING THE SAME, WE ALLOW THIS GROUND OF APPEAL. CONSEQUENTLY, THE PLEA OF ALLOWANCE OF DEPRECIATION AGAINST THE SAME BECOMES INFRUCTUOUS. 4.4 GR. NO.4: EXCLUSION OF FOREIGN GAINS THIS GROUND IS CONNECTED WITH GROUND NO. 5 OF REVEN UES APPEAL. AS ALREADY NOTED, THE ASSESSEE OFFERED FOREIGN EXCHANG E GAIN OF RS.4352.74 LACS IN THE PROFIT & LOSS ACCOUNT. TILL AY 2002-03, THE ASSESSEE CLAIMED DEDUCTION OF FOREX LOSS WHICH WAS DENIED TO THE ASSESSEE TREATING IT AS A NOTIONAL LOSS. THEREFORE, THE ASSESSEE SUBMITTED THAT THE GAIN SHOULD ALSO NOT BE TAXED SI NCE THE CLAIM OF NOTIONAL LOSS WAS NOT ACCEPTED BY THE DEPARTMENT IN EARLIER YEARS. HOWEVER, THE SAID PLEA COULD NOT FIND FAVOR WITH LD . AO WHO DENIED THE ADJUSTMENT OF THE SAME. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 18 THE LEARNED FIRST APPELLATE AUTHORITY CONFIRMED THE SAME SINCE FOREX LOSS DISALLOWANCE MADE IN EARLIER YEARS WAS DELETED IN T HOSE YEARS AND THEREFORE, THE GAIN WOULD BE FULLY TAXABLE. WE ARE OF THE OPINION THAT SIMILAR TREATMENT WOULD BE GIVEN TO LOSSES AS WELL AS GAINS. SINCE THE DEDUCTION OF THE LOSSES HAS ALREADY BEEN ALLOWED TO ASSESSEE IN EARLIER YEARS, SIMILAR GAINS WOULD BE CHARGEABLE TO TAX. TH EREFORE, BY CONFIRMING THE STAND OF LD. CIT(A), WE DISMISS THIS GROUND OF APPEAL. 4.5 GR.NO.5: DISALLOWANCE U/S 14A THIS GROUND IS CONNECTED TO GR. NO. 8 OF REVENUES APPEAL. THEREFORE, RESPECTFULLY FOLLOWING THE STAND OF TRIBUNAL IN EAR LIER YEARS, WE CONFIRM THE ESTIMATION MADE BY LD. CIT(A). THIS GROUND STAN D DISMISSED. 4.6 GR. NO.6: TREATMENT OF INTEREST INCOME OF RS.38 41.56 LACS AND TRUCK HIRE CHARGES FOR RS.2.79 LACS AS INCOME FROM OTHER SOURCES THESE ITEMS WERE TREATED AS BUSINESS INCOME BY THE ASSESSEE WHICH EVENTUALLY LED TO HIGHER CLAIM OF DEDUCTION UNDER C HAPTER VI-A. THE ASSESSEE SUBMITTED THAT THE STATED INCOME WAS ARISI NG OUT OF BUSINESS OPERATIONS. HOWEVER, AS HELD IN EARLIER YEARS, THES E ITEMS WERE TREATED AS INCOME FROM OTHER SOURCES. THE SAME UPON CONFIRMATION BY LD. CIT(A), IS UNDER CHALLENGE BEFORE US. WE FIND THAT THIS GROUND WOULD BE REMITTED BACK TO THE FILE OF LD. AO ON SIMILAR LINES AS DONE BY THE TRIBUNAL IN ITS LATEST ORDER FOR AYS 2002-03 & 2003-04. ACCORDINGLY, LD. AO IS DIRECTED TO RE-ADJU DICATE THE SAME AS DIRECTED BY TRIBUNAL IN AY 1999-2000 AFTER PROVIDIN G DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. THIS GROUND STAND ALLOWED FOR STATISTICAL PURPOSES. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 19 4.7 GR. NO.7: DISALLOWANCE U/S 35D AND NON-ADMISSIO N OF ADDITIONAL GROUND THIS ISSUE WAS NOT SUBJECT MATTER OF QUANTUM ASSESS MENT ORDER AND WAS RAISED BEFORE LD. CIT(A) FOR THE FIRST TIME AS ADDI TIONAL GROUND. THE ASSESSEE CLAIMED DEDUCTION OF RS.0.83 LACS, BEING 1 /10 TH OF TRADEABLE WARRANT ISSUE EXPENSES SINCE THE SAID CLAIM WAS OMI TTED TO BE LODGED IN THE RETURN OF INCOME. HOWEVER, LD. CIT(A) DECLINED TO ADMIT THE SAME. DRAWING ANALOGY FROM THE DECISION OF HONBLE BOMBAY HIGH COURT IN CIT V/S PRUTHVI SHARES & STOCKBROKERS PVT. LTD. (349 IT R 336), WE DIRECT LD. AO TO ADMIT THIS CLAIM AND ADJUDICATE THE SAME AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. THIS GROUND STAND ALLOWED FOR STATISTICAL PURPOSES. 4.8 GR. NO.8: PREMIUM ON LEASED LAND FOR RS.30.73 L ACS THE ASSESSEE CLAIMED DEDUCTION OF PREMIUM ON LEASEH OLD LAND. THE ASSESSEE SUBMITTED THAT IT OBTAINED VARIOUS LANDS O N LEASE BASIS AND PAID PREMIUM FROM TIME TO TIME. THE PERIOD OF LEASE WAS IN THE RANGE OF 30 TO 99 YEARS AND THEREFORE, THE LEASE PREMIUM WAS TO BE WRITTEN-OFF OVER SUCH A PERIOD. THE ATTENTION WAS DRAWN TO THE FACT THAT SIMILAR DEDUCTION WAS ALLOWED UP-TO AY 1997-98. HOWEVER, FO LLOWING THE STAND TAKEN IN AYS 1998-99 TO 2003-04, THE EXPENDITURE WA S HELD TO BE CAPITAL IN NATURE AND THE DEPRECIATION WAS ALSO DENIED SINC E LAND WAS NOT ENTITLED FOR DEPRECIATION UNDER INCOME TAX ACT. THE STAND OF LD. AO, UPON CONFIRMATION BY FIRST APPELLATE AUTHORITY, IS UNDER CHALLENGE BEFORE US. IN LINE WITH THE LATEST ORDER OF THE TRIBUNAL FOR A YS 2002-03 & 2003-04, WE CONFIRM THE STAND OF LD. CIT(A) AND DISMISS THIS GROUND OF APPEAL. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 20 4.9 GR. NO.9: ADDITION OF UNUTILIZED MODVAT CREDIT IT WAS NOTED THAT THE ASSESSEE DID NOT ADD MODVAT C REDIT TO CLOSING STOCK. SIMILAR ADJUSTMENT WAS MADE WHILE FRAMING AS SESSMENT FOR AYS 1990-00 TO 2003-04. REFERRING TO PROVISIONS OF SEC. 145A, THE VALUE OF CLOSING STOCK WAS INCREASED BY RS.576.59 LACS, BEIN G CLOSING UNUTILIZED MODVAT CREDIT. HOWEVER, AT THE SAME TIME, THE CREDI T OF OPENING MODVAT CREDIT FOR RS.775.13 LACS WAS ALLOWED AS DED UCTION. IN OTHER WORDS, THE NET INCOME WAS REDUCED TO THE EXTENT OF DIFFERENTIAL OF OPENING AND CLOSING MODVAT CREDIT I.E. RS.198.54 LA CS. THE LEARNED FIRST APPELLATE AUTHORITY, RELYING UPON EARLIER YEA RS, CONFIRMED THE SAME. IN LINE WITH THE LATEST ORDER OF THE TRIBUNAL FOR A YS 2002-03 & 2003-04, WE REVERSE THE STAND OF LOWER AUTHORITIES AND HOLD THAT NO SUCH ADJUSTMENT WOULD BE WARRANTED. IN OTHER WORDS, THE TOTAL INCOME OF THE ASSESSEE WOULD NOT BE REDUCED BY RS.198.54 LACS. TH IS GROUND STAND ALLOWED. 4.10 GR. NO.10: ADJUSTMENT OF CAPITAL GAIN ON SALE OF INVESTMENT FOR RS.311.81 LACS U/S 115JB THE ASSESSEE, WHILE COMPUTING INCOME U/S 115JB, RED UCED AN AMOUNT OF RS.311.81 LACS, BEING GAIN ON SALE OF INVESTMENT S. THIS ITEM WAS ROUTED THROUGH PROFIT & LOSS ACCOUNT. AS PER STAND TAKEN IN AYS 1998- 99 TO 2003-04, THE SAID AMOUNT WAS ADDED BACK WHILE COMPUTING BOOK PROFITS U/S 115JB. THE LEARNED FIRST APPELLATE AUTHORITY, RELYING UPON EARLIER YEARS, CONFIRMED THE SAME. IN LINE WITH THE LATEST ORDER OF THE TRIBUNAL FOR A YS 2002-03 & 2003-04, WE CONFIRM THE STAND OF LD. CIT(A) AND DISMISS THIS GROUND OF APPEAL. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 21 4.11 GR. NO.11: ADJUSTMENT OF DIVIDEND DISTRIBUTION TAX U/S 115JB AND NON-ADMISSION OF ADDITIONAL GROUND THIS ISSUE WAS NOT SUBJECT MATTER OF QUANTUM ASSESS MENT ORDER AND WAS RAISED BEFORE LD. CIT(A) FOR THE FIRST TIME AS AN A DDITIONAL GROUND. THE ASSESSEE CHALLENGED ADDITION OF DIVIDEND DISTRIBUTI ON TAX FOR RS.1393 LACS WHILE COMPUTING BOOK PROFIT U/S 115JB. HOWEVER, LD. CIT(A) DECLINED TO ADMIT THE SAME. DRAWING ANALOGY FROM THE DECISION OF HONBLE BOMBAY HIGH COURT IN CIT V/S PRUTHVI SHARES & STOCKBROKERS PVT. LTD. (349 IT R 336), WE DIRECT LD. AO TO ADMIT THE SAID CLAIM AND ADJUDICATE THE S AME AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. THIS GR OUND STAND ALLOWED FOR STATISTICAL PURPOSES. 4.12 GR. NO.12 & 13 ARE GENERAL IN NATURE AND DO NO T REQUIRE ANY SPECIFIC ADJUDICATION. 4.13 RESULTANTLY, THE APPEAL STANDS PARTLY ALLOWED TO THE EXTENT AS INDICATED IN THE ORDER. THE LEARNED AO IS DIRECTED TO RECOMPUTE THE INCOME OF THE ASSESSEE IN TERMS OF OUR ADJUDICATION . ASSESSEES ADDITIONAL GROUND OF APPEAL & REVENUES CROSS- OBJECTIONS 5.1 THE ASSESSEE, VIDE PETITION DATED 15/05/2017, H AS PLEADED FOR ADMISSION OF AN ADDITIONAL GROUND OF APPEAL WHICH R EAD AS UNDER: - 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, SALES TAX INCENTIVE/SUBSIDY OF RS.1,28,25,66,755/- AVAILED DURING THE YEAR UNDE R CONSIDERATION BE TREATED AS CAPITAL RECEIPT AND HENCE NOT TAXABLE IN COMPUTING TOTAL INCOME UNDER THE NORMAL PROVISIONS OF THE ACT. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, SALES TAX INCENTIVE/SUBSIDY OF RS.1,28,25,66,755/- AVAILED DURING THE YEAR UNDE R CONSIDERATION BE TREATED AS CAPITAL RECEIPT AND HENCE BE EXCLUDED IN COMPUTING BOOK PROFIT U/S 115JB OF THE ACT. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 22 3. THAT THE APPELLANT CRAVES LEAVE, TO ADD, TO AMEN D, MODIFY, RESCIND, SUPPLEMENT, OR ALTER ADDITIONAL GROUNDS TAKEN HERE-IN-ABOVE, EITHE R BEFORE OR AT THE TIME OF HEARING OF THIS APPEAL. THE ASSESSEE, IN THE PLEADING, HAVE SUBMITTED THAT THE INCENTIVES WERE GRANTED FOR SETTING UP OR EXPANSION OF EXISTING UNI TS IN THE BACKWARD AREAS / SPECIFIED AREAS AND FOR GENERATION OF EMPLO YMENT AND THEREFORE, THE SAME WOULD BE CAPITAL IN NATURE. IN THE ABOVE B ACKGROUND, A PLEA HAS BEEN RAISED TO ADMIT THE SAID ADDITIONAL GROUND OF APPEAL. RELIANCE HAS BEEN PLACED ON THE DECISION OF HONBLE APEX COU RT IN JUTE CORPORATION OF INDIA LTD. V/S CIT (187 ITR 688), DECISION OF JURISDICTIONAL HIGH COURT IN AHMEDABAD ELECTRICITY CO. LTD. V/S CIT (199 ITR 351) AND THE DECISION OF THIS TRIBUNAL IN NIVEA INDIA P.LTD. V/S DCIT (2017 189 TTJ 422). 5.2 AU CONTRAIRE, THE REVENUE HAS FILED CROSS-OBJECTIONS, AGAINST ADMISSION OF ADDITIONAL GROUND OF APPEAL, AT THIS S TAGE. THE OBJECTION RAISED BY REVENUE READ AS UNDER: - WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE ASSESSEE IS RIGHT IN FILING ADDITIONAL GROUND OF APPEAL IN RESPECT OF SA LES TAX INCENTIVE/SUBSIDY OF RS.1,28,25,66,755/- AVAILED DURING THE YEAR UNDER C ONSIDERATION BEFORE HON'BLE ITAT AT THIS STAGE, WHEREAS THERE IS NO DISCLOSURE OF THE SAME IN AUDIT REPORT AS WELL AS BEFORE THE AO DURING ASSESSMENT PROCEEDINGS AND THE ID. CIT(A) DURING THE APPELLATE PROCEEDINGS. 5.3 UPON PERUSAL OF LATEST TRIBUNAL ORDER FOR AY 20 02-03, ITA NO. 7092/MUM/2005 DATED 10/08/2018, WE FIND THAT UNDER SIMILAR FACTUAL MATRIX, THE ADDITIONAL GROUND RAISED BY THE ASSESSE E WAS ADMITTED BY THE CO-ORDINATE BENCH BY OBSERVING AS UNDER: - 67. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSE D MATERIALS ON RECORD. UNDISPUTEDLY, THE ASSESSEE HAS NOT CLAIMED THE SALE S TAX INCENTIVES RECEIVED BY IT AS CAPITAL IN NATURE EITHER IN THE RETURN OF INCOME FILED FOR THE IMPUGNED ASSESSMENT YEAR NOR IN COURSE OF PROCEEDINGS BEFORE THE DEPART MENTAL AUTHORITIES. IN FACT, THE ASSESSEE ITSELF HAS TREATED THE SALES TAX INCENTIVE RECEIVED BY IT AS REVENUE IN NATURE BY INCLUDING IT IN THE SALES AS REFLECTED IN THE BOOKS OF ACCOUNT AND AUDITED AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 23 FINANCIAL STATEMENTS. IT IS ONLY AT THE SECOND APPE LLATE STAGE BEFORE THE TRIBUNAL THE ASSESSEE HAS CLAIMED THE SALES TAX INCENTIVES RECEI VED BY IT AS CAPITAL IN NATURE BY RAISING THE ADDITIONAL GROUNDS. THUS, THE FIRST ISS UE WHICH IS TO BE DECIDED IS, WHETHER THE ADDITIONAL GROUNDS RAISED BY THE ASSESS EE AT THIS STAGE ARE TO BE ADMITTED OR NOT. IT IS THE CONTENTION OF THE ASSESS EE BEFORE US THAT ON THE BASIS OF RATIO LAID DOWN IN CERTAIN JUDICIAL PRECEDENTS, WHE REIN, IT IS HELD THAT SALES TAX INCENTIVE RECEIVED IS CAPITAL IN NATURE, THE ASSESS EE HAS RAISED THE ADDITIONAL GROUND. ON A CAREFUL ANALYSIS OF THE DECISIONS RELI ED UPON BY THE LEARNED AUTHORISED REPRESENTATIVE IN SUPPORT OF ADMISSION OF ADDITIONA L GROUND, WE FIND THAT IF THE BASIC FACTS RELATING TO THE ISSUES RAISED IN THE ADDITION AL GROUNDS ARE AVAILABLE ON RECORD AND IT DOES NOT REQUIRE INVESTIGATION INTO FRESH FA CTS AND THE ISSUE RAISED IS A LEGAL ISSUE THE ADDITIONAL GROUND RAISED CAN BE ADMITTED EVEN IF SUCH ADDITIONAL GROUNDS ARE RAISED BY THE ASSESSEE ON THE BASIS OF DECISION S RENDERED SUBSEQUENTLY. IF WE EXAMINE THE FACTS OF THE PRESENT CASE, IT IS SEEN T HAT THE FACT THAT THE ASSESSEE HAS RECEIVED SALES TAX INCENTIVE WHICH FORMS PART OF TH E SALES IS EVIDENT FROM THE AUDITED FINANCIAL STATEMENTS OF THE ASSESSEE FILED BEFORE THE ASSESSING OFFICER. THE ONLY THING WHICH REQUIRES TO BE DECIDED IS A PURELY LEGAL ISSUE AS TO WHETHER THE RECEIPT IS OF REVENUE OR CAPITAL NATURE KEEPING IN VIEW THE RELEVANT SALES TAX INCENTIVE SCHEMES AS WELL AS THE NATURE OF INCENTIV E GRANTED. ONCE SUCH FACTS ARE EXAMINED FROM THE RELEVANT SALES TAX INCENTIVE SCHE MES AND FOR WHAT PURPOSE THE SALES TAX INCENTIVE IS TO BE UTILIZED, THEN, THE NA TURE OF SUCH RECEIPT CAN BE DECIDED BY APPLYING THE PRINCIPLES LAID DOWN IN THE JUDICIA L PRECEDENTS RELIED UPON BY THE ASSESSEE. ARTICLE265 OF THE CONSTITUTION OF INDIA MANDATES THAT NO TAX SHALL BE LEVIED AND COLLECTED EXCEPT BY AUTHORITY OF LAW. IT IS ALSO ACCEPTED LEGAL POSITION THAT ALL RECEIPTS ARE NOT IN THE NATURE OF INCOME. UNDER THE PROVISIONS OF INCOME TAX ACT, 1961, RECEIPTS WHICH ARE CAPITAL IN NATURE ARE NOT TAXABLE. THEREFORE, IT NEEDS TO BE EXAMINED IN THE TOUCHSTONE OF THE JUDICIAL PRECEDEN TS RELIED UPON BY THE ASSESSEE WHETHER THE SALES TAX INCENTIVE RECEIVED ARE OF CAP ITAL OR REVENUE NATURE. THAT BEING THE CASE, WE CANNOT SHUT THE DOOR ON THE ASSE SSEE FROM RAISING THE ADDITIONAL GROUNDS. THAT BEING THE CASE, WE ARE OF THE CONSIDE RED OPINION THAT THE ADDITIONAL GROUNDS RAISED BY THE ASSESSEE HAVE TO BE ADMITTED. ACCORDINGLY, WE DO SO. HOWEVER, IT IS A FACT ON RECORD, THE ISSUES RAISED IN THE ADDITIONAL GROUNDS WERE NEVER RAISED BY THE ASSESSEE IN COURSE OF PROCEEDIN GS BEFORE THE DEPARTMENTAL AUTHORITIES. IN FACT, THE ASSESSEE ITSELF HAS TREAT ED THE SALES TAX INCENTIVES AS A REVENUE RECEIPT IN ITS BOOKS OF ACCOUNT. MOREOVER, THE NATURE OF SUBSIDY GRANTED HAVE TO BE DETERMINED KEEPING IN VIEW THE RELEVANT SALES TAX INCENTIVE SCHEMES OF THE STATE GOVERNMENTS AND SPECIFIC PURPOSE FOR WHIC H SUCH SUBSIDIES / INCENTIVES WERE GRANTED. THESE FACTS HAVE NOT BEEN EXAMINED BY THE DEPARTMENTAL AUTHORITIES, SINCE, THE ASSESSEE DID NOT RAISE THE ISSUE EARLIER BEFORE THEM. THEREFORE, ON OVER ALL CONSIDERATION OF FACTS AND MATERIAL ON RECORD A ND ALSO KEEPING IN VIEW THE FACT THAT THE DEPARTMENT SHOULD BE GIVEN AN FAIR AND REA SONABLE OPPORTUNITY TO EXAMINE ASSESSEES CLAIM, WE ARE INCLINED TO RESTORE THE IS SUES RAISED IN THE ADDITIONAL GROUNDS TO THE FILE OF THE ASSESSING OFFICER FOR FR ESH ADJUDICATION KEEPING IN VIEW THE RELEVANT SALES TAX INCENTIVE SCHEMES AND THE DECISI ONS RELIED UPON BY THE ASSESSEE. NEEDLESS TO SAY, THE ASSESSING OFFICER MU ST AFFORD REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE D ECIDING THE ISSUES THROUGH A SPEAKING ORDER. BOTH THE ADDITIONAL GROUNDS ARE ALL OWED FOR STATISTICAL PURPOSES. AMBUJA CEMENTS LIMITED ASSESSMENT YEAR: 2004-05 24 SIMILAR ADDITIONAL GROUND WAS ADMITTED FOR AY 2003- 04 ALSO. FACTS BEING PARI-MATERIA THE SAME, FOLLOWING THE CONSISTENT VIE W OF THE TRIBUNAL, WE ADMIT THE ADDITIONAL GROUND OF APPEAL AS RAISED BY THE ASSESSEE AND REMIT THE SAME BACK TO THE FILE OF LD. AO ON SIMILA R LINES. THE ADDITIONAL GROUND STAND ALLOWED FOR STATISTICAL PURPOSES WHERE AS THE CROSS- OBJECTIONS FILED BY THE REVENUE STAND DISMISSED. CONCLUSION 6. THE ASSESSEES APPEAL AS WELL AS REVENUES APPEA L STAND PARTLY ALLOWED TO THE EXTENT INDICATED IN THE ORDER. THE C ROSS-OBJECTION FILED BY THE REVENUE STAND DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 06 TH JANUARY, 2020. SD/- SD/- (MAHAVIR SINGH) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 06/01/2020 SR.PS, JAISY VARGHESE !'! / COPY OF THE ORDER FORWARDED TO : 1. ;= / THE APPELLANT 2. >?;= / THE RESPONDENT 3. L ( ) / THE CIT(A) 4. L / CIT CONCERNED 5. MN>GO , O , / DR, ITAT, MUMBAI 6. NPQ / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.