Himalaya Arms Co., Jammu V. The Income Tax Officer, Jammu

ITA 11/ASR/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5670 (ITAT-AMRITSAR)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 10-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P N ARORA; RAJAT MEN GI
• Keywords: Capital receipt
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH: AMRITSAR. BEFORE SHRI H.L. KARWA, VICE PRESIDENT AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER. I.T.A. NOS.11 & 12(ASR)/2011. (ASSESSMENT YEARS: 2006-07 & 2007-08) M/S.HIMALAYA ARMS CO. THE INCOME TAX OFFICER, PHASE III PLOT NO.104, WARD 1(1), JAMMU. OUTSIDE INDUSTRIAL AREA, GANGYAL, JAMMU. (APPELLANT) VS. (RESPONDENT) APPELLANT BY: S/SHRI P.N.ARORA, ADV. & RAJAT MEN GI, C.A. RESPONDENT BY: SHRI TARSEM LAL, D.R. ORDER PER MEHAR SINGH, ACCOUNTANT MEMBER. BOTH THESE APPEALS FILED BY THE ASSESSEE ARE DIREC TED AGAINST THE SEPARATE ORDERS PASSED BY THE CIT(A), JAMMU DATED 2 0-10-2010 AND 2-11-2010, RELATING TO THE ASSESSMENT YEARS 2006-07 AND 2007-08. SINCE THE COMMON FACTS AND THE ISSUES ARE INVOLVED IN BOTH TH E APPEALS, THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY A CONSO LIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. I.T.A. NO.11(ASR)/2011(ASSESSMENT YEAR 2006-07): - GROUND NOS.1 AND 2 ARE GENERAL IN NATURE AND HENCE NO FINDINGS ARE BEING GIVEN. 3. GROUND NOS.3 TO 5 READ AS UNDER:- 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW REFUND OF EXCISE DUTY AMOUNTING TO RS.7,85,616/- IS A CAPITAL 2 RECEIPT NOT LIABLE TO TAX UNDER THE PROVISIONS OF THE INCOME TAX ACT, 1961 (THE ACT). 4. THAT THERE IS NO STRAIGHT JACKET PRINCIPLE OF PR INCIPLE OF DISTINGUISHING A CAPITAL RECEIPT FROM A REVENUE REC EIPT AND DEPENDS UPON THE CIRCUMSTANCES OF EACH CASE. 5. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN HOL DING THAT EXCISE DUTY PAID AND REFUNDED BY THE CENTRAL EXCISE DEPART MENT IS DEBITED TO THE EXCISE DUTY RECEIVABLE AMOUNT. 3.1 BRIEFLY STATED THE FACTS OF THE CASE ARE THAT T HE ASSESSEE IS ENGAGED IN THE MANUFACTURING OF GUNS. DURING THE ASSESSMENT YE AR UNDER CONSIDERATION, THE ASSESSEE RECEIVED REFUND OF EXCISE DUTY AMOUNTI NG TO RS.7,85,616/-. ON THIS AMOUNT, THE ASSESSEE CLAIMED DEDUCTION UNDER S ECTION 80-IB OF THE INCOME TAX ACT, 1961 (IN SHORT, THE ACT). HOWEVE R, THE A.O. REJECTED THE CLAIM OF THE ASSESSEE AND TAXED THE ENTIRE INCOME.. 4. ON APPEAL, THE CIT(A) FOLLOWING THE ORDER OF THE AMRITSAR BENCH OF THE TRIBUNAL PASSED IN THE CASE OF M/S.SHREE BALAJI ALLOYS, KATHUA DATED 26-11-2009 DISMISSED THE APPEAL OF THE ASSESSEE. 5. WE HAVE HEARD THE LEARNED D.R. AND HAVE ALSO PER USED THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT M/S.SHREE BAL AJI ALLOYS, KATHUA CHALLENGED THE ORDER OF THE TRIBUNAL BEFORE THE HON BLE J & K HIGH COURT. THE ISSUE BEFORE THE HONBLE JURISDICTIONAL HIGH CO URT WAS AS UNDER:- WHETHER THE AMOUNT OF EXCISE REFUND AND INTERES T SUBSIDY RECEIVED BY THE APPELLANTS-ASSESSES, IN PURSUANCE OF THE IN CENTIVES ANNOUNCED AND SANCTIONED VIDE GOVERNMENT OF INDIA, MINISTRY O F COMMERCE AND INDUSTRY (DEPARTMENT OF INDUSTRIAL POLICY AND PROMO TION)S OFFICE MEMORANDUM NO.1(13)2000-NER DATED JUNE 4, 2002 AND CENTRAL EXCISE NOTIFICATION NOS.56 AND 57, DATED NOVEMBER 1 4,2002 AND OTHER NOTIFICATIONS ISSUED ON THE SUBJECT, PERTAINI NG TO THE INDUSTRIAL POLICY INTRODUCED IN THE STATE OF JAMMU & KASHMIR, IS A CAPITAL 3 RECEIPT AND, THUS, NOT LIABLE TO TAX UNDER THE PROV ISIONS OF THE ACT, OR REVENUE RECEIPT, AS OPINED BY THE AUTHORITIES UNDER THE ACT? 6. THE HONBLE JURISDICTIONAL HIGH COURT VIDE JUDGM ENT DATED 31-1-2011 IN THE CASE OF M/S.SHREE BALAJI ALLOYS, KATHUA, REP ORTED IN (2011) 333 ITR 335 (J&K) DECIDED THE ISSUE, OBSERVING AS UNDER:- IN THIS VIEW OF THE MATTER, THE INCENTIVES PROV IDED TO THE INDUSTRIAL UNITS, IN TERMS OF THE NEW INDUSTRIAL PO LICY, FOR ACCELERATED INDUSTRIAL DEVELOPMENT IN THE STATE, FO R CREATION OF SUCH INDUSTRIAL ATMOSPHERE AND ENVIRONMENT, WHICH W OULD PROVIDE ADDITIONAL PERMANENT SOURCE OF EMPLOYMENT T O THE UNEMPLOYED IN THE STATE OF JAMMU AND KASHMIR, WERE IN FACT, IN THE NATURE OF CREATION OF NEW ASSETS OF INDUSTRI AL ATMOSPHERE AND ENVIRONMENT, HAVING THE POTENTIAL OF EMPLOYMENT GENERATION TO ACHIEVE A SOCIAL OBJECT. SUCH INCENT IVES, DESIGNED TO ACHIEVE PUBLIC PURPOSE, CANNOT, BY ANY STRETCH O F REASONING, BE CONSTRUED AS PRODUCTION OR OPERATIONAL INCENTIVE S FOR THE BENEFIT OF ASSESSEES ALONE. THUS, LOOKING TO THE PURPOSE, OF ERADICATION OF THE SOCIAL PROBLEM OF UNEMPLOYMENT IN THE STATE BY ACCELERATIO N OF THE INDUSTRIAL DEVELOPMENT AND REMOVING BACKWARDNESS OF THE AREA THAT LAGGED BEHIND IN INDUSTRIAL DEVELOPMENT, WHICH IS CERTAINLY A PURPOSE IN THE PUBLIC INTEREST, THE INCENTIVES PR OVIDED BY THE OFFICE MEMORANDUM AND STATUTORY NOTIFICATIONS ISSUE D IN THIS PRODUCTION AND TRADE INCENTIVES, AS HELD BY THE TRI BUNAL. MAKING OF ADDITIONAL PROVISION IN THE SCHEME THAT INCENTIVES WOULD BECOME AVAILABLE TO THE INDUSTRIAL UNITS, ENTITLED THERETO, FROM THE DATE OF COMMENCEMENT OF THE COMMERCIAL PRODUCTION, AND THAT THESE WERE NOT REQU IRED FOR CREATION OF NEW ASSETS CANNOT BE VIEWED IN ISOLATIO N, TO TREAT THE INCENTIVES AS PRODUCTION INCENTIVES, AS HELD BY THE TRIBUNAL, FOR THE MEASURE SO TAKEN, APPEARS TO HAVE BEEN INTENDED TO ENSURE THAT THE INCENTIVES WERE MADE AVAILABLE ONLY TO THE BONA FIDE INDUSTRIAL UNITS SO THAT LARGER PUBLIC INTEREST OF DEALING WITH UNEMPLOYMENT IN THE STATE, AS INTENDED, IN TERMS OF THE OFFICE MEMORANDUM, WAS ACHIEVED. 4 THE OTHER FACTORS, WHICH HAD WEIGHED WITH THE TRIBU NAL IN DETERMINING THE INCENTIVES AS PRODUCTION INCENTI VES MAY NOT BE DECISIVE TO DETERMINE THE CHARACTER OF THE INCEN TIVE SUBSIDIES, WHEN IT IS FOUND, AS DEMONSTRATE IN THE OFFICE MEMORANDUM, AMENDMENT INTRODUCED THERETO AND THE ST ATUTORY NOTIFICATION TOO THAT THE INCENTIVES WERE PROVIDED WITH THE OBJECT OF CREATING AVENUES FOR PERPETUAL EMPLOYMENT , TO ERADICATE THE SOCIAL PROBLEM OF UNEMPLOYMENT IN THE STATE BY ACCELERATED INDUSTRIAL DEVELOPMENT. FOR ALL WHAT HA BEEN SAID ABOVE, THE FINDING OF THE TRIBUNAL ON THE FIRST ISSUE THAT THE EXCISE DUTY RE FUND, INTEREST SUBSIDY AND INSURANCE SUBSIDY WERE PRODUCTION INCEN TIVES, HENCE REVENUE RECEIPT, CANNOT BE SUSTAINED, BEING A GAINST THE LAW LAID DOWN BY THE HONBLE SUPREME COURT OF INDIA IN SAHNEY STEEL CASE [1997] 228 ITR 253 AND PONNI SUGARS CASE [2008] 306 ITR 391. THE FINDING OF THE TRIBUNAL THAT THE INCENTIVES WER E REVENUE RECEIPT IS, ACCORDINGLY, SET-ASIDE HOLDING THE INCENTIVES TO BE CAPITAL RECEIPTS IN THE HANDS OF THE ASSESSE E. IN VIEW OF OUR ABOVE FINDING ON THE FIRST ISSUE, TH ERE IS NO NEED TO OPINE ON THE SECOND ISSUE, WHICH WAS RAISED IN THE ALTERNATIVE. 7. RESPECTFULLY FOLLOWING THE JUDGMENT OF THE HONB LE J & K HIGH COURT IN THE CASE OF M/S.SHREE BALAJI ALLOYS (SUPRA), WE HOLD THAT THE AMOUNT OF EXCISE DUTY REFUND AMOUNTING TO RS.7,85,616/- FOR THE ASSESSMENT YEAR 2006-07 RECEIVED BY THE ASSESSEE DURING THE ASSESSM ENT YEAR UNDER CONSIDERATION IS A CAPITAL RECEIPT AND THUS NOT LI ABLE TO TAX UNDER THE PROVISIONS OF THE INCOME TAX ACT, 1961. 8. GROUND NOS.6 AND 7 READ AS UNDER:- 6. THE CIT(A) HAS ERRED ON FACTS AND IN LAW IN UPH OLDING THE ACTION OF LEARNED OFFICER IN MAKING THE IMPUGNED AD DITION OF 5 RS.7,85,616/- ON ACCOUNT OF EXCISE DUTY REFUND BY T REATING IT IS A REVENUE RECEIPT AND INCOME OF THE APPELLANT AND N OT ALLOWING THE CLAIM OF DEDUCTION U/S.80IB OF THE INCOME TAX A CT ON THIS. 7. THAT ON THE FACTS AND IN LAW THE LD. CIT(A) ERRE D IN UPHOLDING THAT THE EXCISE DUTY REFUND OF RS.7,85,616/- RECEIV ED BY THE ASSESSEE WAS NOT DERIVED FROM THE INDUSTRIAL UNDERT AKING AND THUS WAS NOT ELIGIBLE FOR CLAIM OF DEDUCTION UNDER SECTION 80IB OF THE INCOME TAX ACT, 1961. IT IS PRAYED THAT THE DEDUCTION U/S.80IB MAY BE ALLOWED AT RS.26,35,954/- AS CLAIME D. 8.1 SINCE WE HAVE ALLOWED GROUND NOS.3 TO 5 OF THE APPEAL AND, THEREFORE, WE DO NOT THINK IT NECESSARY TO DECIDE GROUND NOS.6 & 7 OF THE APPEAL AND HENCE NO FINDINGS ARE BEING GIVEN. 9. GROUND NO.8 READS AS UNDER:- THE DISALLOWANCE OF DEDUCTION U/S,.80IB ON ACCOUNT OF P.F. RS.83,591/- AND ESI RS.57,214/- U/S.43B IN THE COMP UTATION BY THE ASSESSEE HIMSELF IS UNLAWFUL, UNJUSTIFIED AN AGAINS T THE FACTS OF THE ASSESSEE. 9.1 AT THE TIME OF HEARING, SHRI P.N. ARORA, ADVOCATE, THE LEARNED COUNSEL FOR THE ASSESSEE, DID NOT PRESS FOR THIS GROUND OF APPEAL AND HENCE WE DISMISS THE SAME AS NOT PRESSED. 10. I.T.A. NO.12(ASR)/2011 (ASSESSMENT YEAR 2007-08 ):- GROUND NOS. 1 AND 2 OF THE APPEAL ARE GENERAL IN N ATURE AND HENCE NO FINDINGS ARE BEING GIVEN. 11. GROUND NOS.3 TO 5 READ AS UNDER:- 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW REFUND OF EXCISE DUTY AMOUNTING TO RS.24,29,760/- I S A CAPITAL RECEIPT NOT LIABLE TO TAX UNDER THE PROVISIONS OF THE INCOME TAX ACT, 1961 (THE ACT). 6 4. THAT THERE IS NO STRAIGHT JACKET PRINCIPLE OF PR INCIPLE OF DISTINGUISHING A CAPITAL RECEIPT FROM A REVENUE REC EIPT AND DEPENDS UPON THE CIRCUMSTANCES OF EACH CASE. 5. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN HOL DING THAT EXCISE DUTY PAID AND REFUNDED BY THE CENTRAL EXCISE DEPART MENT IS DEBITED TO THE EXCISE DUTY RECEIVABLE AMOUNT. 11.1 BRIEFLY STATED THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGAGED IN THE MANUFACTURING OF GUNS. DURING THE ASSESSMENT YE AR UNDER CONSIDERATION, THE ASSESSEE RECEIVED REFUND OF EXCISE DUTY AMOUNTI NG TO RS.24,29,760/-. ON THIS AMOUNT, THE ASSESSEE CLAIMED DEDUCTION UNDER S ECTION 80-IB OF THE INCOME TAX ACT, 1961 (IN SHORT, THE ACT). HOWEVE R, THE A.O. REJECTED THE CLAIM OF THE ASSESSEE AND TAXED THE ENTIRE INCOME.. 12. ON APPEAL, THE CIT(A) FOLLOWING THE ORDER OF TH E AMRITSAR BENCH OF THE TRIBUNAL PASSED IN THE CASE OF M/S.SHREE BALAJI ALLOYS, KATHUA DATED 26-11-2009 DISMISSED THE APPEAL OF THE ASSESSEE. 13. WE HAVE HEARD THE LEARNED D.R. AND HAVE ALSO PE RUSED THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT M/S.SHREE BAL AJI ALLOYS, KATHUA CHALLENGED THE ORDER OF THE TRIBUNAL BEFORE THE HON BLE J & K HIGH COURT. THE ISSUE BEFORE THE HONBLE JURISDICTIONAL HIGH CO URT WAS AS UNDER:- WHETHER THE AMOUNT OF EXCISE REFUND AND INTERES T SUBSIDY RECEIVED BY THE APPELLANTS-ASSESSES, IN PURSUANCE OF THE IN CENTIVES ANNOUNCED AND SANCTIONED VIDE GOVERNMENT OF INDIA, MINISTRY O F COMMERCE AND INDUSTRY (DEPARTMENT OF INDUSTRIAL POLICY AND PROMO TION)S OFFICE MEMORANDUM NO.1(13)2000-NER DATED JUNE 4, 2002 AND CENTRAL EXCISE NOTIFICATION NOS.56 AND 57, DATED NOVEMBER 1 4,2002 AND OTHER NOTIFICATIONS ISSUED ON THE SUBJECT, PERTAINI NG TO THE INDUSTRIAL POLICY INTRODUCED IN THE STATE OF JAMMU & KASHMIR, IS A CAPITAL RECEIPT AND, THUS, NOT LIABLE TO TAX UNDER THE PROV ISIONS OF THE ACT, OR REVENUE RECEIPT, AS OPINED BY THE AUTHORITIES UNDER THE ACT? 7 14. THE HONBLE JURISDICTIONAL HIGH COURT VIDE JUDG MENT DATED 31-1-2011 IN THE CASE OF M/S.SHREE BALAJI ALLOYS, KATHUA, REP ORTED IN (2011) 333 ITR 335 (J&K) DECIDED THE ISSUE, OBSERVING AS UNDER:- IN THIS VIEW OF THE MATTER, THE INCENTIVES PROV IDED TO THE INDUSTRIAL UNITS, IN TERMS OF THE NEW INDUSTRIAL PO LICY, FOR ACCELERATED INDUSTRIAL DEVELOPMENT IN THE STATE, FO R CREATION OF SUCH INDUSTRIAL ATMOSPHERE AND ENVIRONMENT, WHICH W OULD PROVIDE ADDITIONAL PERMANENT SOURCE OF EMPLOYMENT T O THE UNEMPLOYED IN THE STATE OF JAMMU AND KASHMIR, WERE IN FACT, IN THE NATURE OF CREATION OF NEW ASSETS OF INDUSTRI AL ATMOSPHERE AND ENVIRONMENT, HAVING THE POTENTIAL OF EMPLOYMENT GENERATION TO ACHIEVE A SOCIAL OBJECT. SUCH INCENT IVES, DESIGNED TO ACHIEVE PUBLIC PURPOSE, CANNOT, BY ANY STRETCH O F REASONING, BE CONSTRUED AS PRODUCTION OR OPERATIONAL INCENTIVE S FOR THE BENEFIT OF ASSESSEES ALONE. THUS, LOOKING TO THE PURPOSE, OF ERADICATION OF THE SOCIAL PROBLEM OF UNEMPLOYMENT IN THE STATE BY ACCELERATIO N OF THE INDUSTRIAL DEVELOPMENT AND REMOVING BACKWARDNESS OF THE AREA THAT LAGGED BEHIND IN INDUSTRIAL DEVELOPMENT, WHICH IS CERTAINLY A PURPOSE IN THE PUBLIC INTEREST, THE INCENTIVES PR OVIDED BY THE OFFICE MEMORANDUM AND STATUTORY NOTIFICATIONS ISSUE D IN THIS PRODUCTION AND TRADE INCENTIVES, AS HELD BY THE TRI BUNAL. MAKING OF ADDITIONAL PROVISION IN THE SCHEME THAT INCENTIVES WOULD BECOME AVAILABLE TO THE INDUSTRIAL UNITS, ENTITLED THERETO, FROM THE DATE OF COMMENCEMENT OF THE COMMERCIAL PRODUCTION, AND THAT THESE WERE NOT REQU IRED FOR CREATION OF NEW ASSETS CANNOT BE VIEWED IN ISOLATIO N, TO TREAT THE INCENTIVES AS PRODUCTION INCENTIVES, AS HELD BY THE TRIBUNAL, FOR THE MEASURE SO TAKEN, APPEARS TO HAVE BEEN INTENDED TO ENSURE THAT THE INCENTIVES WERE MADE AVAILABLE ONLY TO THE BONA FIDE INDUSTRIAL UNITS SO THAT LARGER PUBLIC INTEREST OF DEALING WITH UNEMPLOYMENT IN THE STATE, AS INTENDED, IN TERMS OF THE OFFICE MEMORANDUM, WAS ACHIEVED. THE OTHER FACTORS, WHICH HAD WEIGHED WITH THE TRIBU NAL IN DETERMINING THE INCENTIVES AS PRODUCTION INCENTI VES MAY NOT 8 BE DECISIVE TO DETERMINE THE CHARACTER OF THE INCEN TIVE SUBSIDIES, WHEN IT IS FOUND, AS DEMONSTRATE IN THE OFFICE MEMORANDUM, AMENDMENT INTRODUCED THERETO AND THE ST ATUTORY NOTIFICATION TOO THAT THE INCENTIVES WERE PROVIDED WITH THE OBJECT OF CREATING AVENUES FOR PERPETUAL EMPLOYMENT , TO ERADICATE THE SOCIAL PROBLEM OF UNEMPLOYMENT IN THE STATE BY ACCELERATED INDUSTRIAL DEVELOPMENT. FOR ALL WHAT HA BEEN SAID ABOVE, THE FINDING OF THE TRIBUNAL ON THE FIRST ISSUE THAT THE EXCISE DUTY RE FUND, INTEREST SUBSIDY AND INSURANCE SUBSIDY WERE PRODUCTION INCEN TIVES, HENCE REVENUE RECEIPT, CANNOT BE SUSTAINED, BEING A GAINST THE LAW LAID DOWN BY THE HONBLE SUPREME COURT OF INDIA IN SAHNEY STEEL CASE [1997] 228 ITR 253 AND PONNI SUGARS CASE [2008] 306 ITR 391. THE FINDING OF THE TRIBUNAL THAT THE INCENTIVES WER E REVENUE RECEIPT IS, ACCORDINGLY, SET-ASIDE HOLDING THE INCENTIVES TO BE CAPITAL RECEIPTS IN THE HANDS OF THE ASSESSE E. IN VIEW OF OUR ABOVE FINDING ON THE FIRST ISSUE, TH ERE IS NO NEED TO OPINE ON THE SECOND ISSUE, WHICH WAS RAISED IN THE ALTERNATIVE. 15. RESPECTFULLY FOLLOWING THE JUDGMENT OF THE HON BLE J & K HIGH COURT IN THE CASE OF M/S.SHREE BALAJI ALLOYS (SUPRA), WE HOLD THAT THE AMOUNT OF EXCISE DUTY REFUND AMOUNTING TO RS.24,29,760/- FOR THE ASSESSMENT YEAR 2007-08 RECEIVED BY THE ASSESSEE DURING THE ASSESSM ENT YEAR UNDER CONSIDERATION IS A CAPITAL RECEIPT AND THUS NOT LI ABLE TO TAX UNDER THE PROVISIONS OF THE INCOME TAX ACT, 1961. 16. GROUND NOS.6 AND 7 READ AS UNDER:- 6. THE CIT(A) HAS ERRED ON FACTS AND IN LAW IN UP HOLDING THE ACTION OF LEARNED OFFICER IN MAKING THE IMPUGNED AD DITION OF RS.24,29,760/- ON ACCOUNT OF EXCISE DUTY REFUND BY TREATING IT IS A REVENUE RECEIPT AND INCOME OF THE APPELLANT AND N OT ALLOWING THE CLAIM OF DEDUCTION U/S.80IB OF THE INCOME TAX A CT ON THIS. 9 7. THAT ON THE FACTS AND IN LAW THE LD. CIT(A) ERRED I N UPHOLDING THAT THE EXCISE DUTY REFUND OF RS.24,29,760/- RECEIVED B Y THE ASSESSEE WAS NOT DERIVED FROM THE INDUSTRIAL UNDERTAKING AND THUS WAS NOT ELIGIBLE FOR CLAIM OF DEDUCTION UNDER SECTION 80IB OF THE INCOME TAX ACT, 1961. IT IS PRAYED THAT THE DEDUCTION U/S .80IB MAY BE ALLOWED AT RS.46,60,174/- AS CLAIMED. 16.1 SINCE WE HAVE ALLOWED GROUND NOS.3 TO 5 OF THE APPEAL AND, THEREFORE, WE DO NOT THINK IT NECESSARY TO DECIDE GROUND NOS.6 & 7 OF THE APPEAL AND HENCE NO FINDINGS ARE BEING GIVEN. 17. NO OTHER POINT WAS RAISED OR ARGUED BY THE ASSE SSEE BEFORE US. 18. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED IN THE TERMS AS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND JUNE, 2011. SD/- SD/- (H.L. KARWA) (MEHAR SINGH) VICE PRESIDENT. ACCOUNTANT MEMBER. DATED: 22 ND JUNE, 2011. KC/- COPY OF THE ORDER FORWARDED TO:- (1) THE ASSESSEE: M/S.HIMALAYA ARMS CO., GANGYAL, JAMMU . (2) THE ITO, WARD 1(1), JAMMU. (3) THE CIT, JAMMU. (4) THE CIT(A), JAMMU. (5) THE SR. DR, ITAT, ASR. TRUE COPY BY ORDER ASSTT. REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, AMRITSAR.