DCIT, Cir-11(1), Kolkata, Kolkata V. M/s. Emami Biotech Ltd., Kolkata

ITA 1915/KOL/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 0310 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 28-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Question of law; Capital receipt; Bonafide mistake
• Section: 115JB

Judgement Text

ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 1 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA A BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, VICE-PRESIDENT (KZ) AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 1915/KOL/2017 ASSESSMENT YEAR: 2011-2012 DEPUTY COMMISSIONER OF INCOME TAX,................. ...................APPELLANT CIRCLE-11(1), KOLKATA, P-7, CHOWRINGHEE SQUARE, AAYAKAR BHAWAN, KOLKATA-700 069 -VS.- M/S. EMAMI BIOTECH LIMITED,........................ .........................RESPONDENT 687, ANANDAPUR, E.M. BYPASS ROAD, KOLKATA-700 107 [PAN:AABCN 7953 M] APPEARANCES BY: SHRI A.K. NAYAK, CIT (D.R.), FOR THE APPELLANT SHRI D.S. DAMLE, FCA AND SHRI AKKAL DUDHWEWALA, FCA , FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : JANUARY 03, 2019 DATE OF PRONOUNCING THE ORDER : MARCH 29, 2019 O R D E R PER SHRI P.M. JAGTAP, VICE-PRESIDENT (KZ):- THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST TH E ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-22, KOLKATA DA TED 23.06.2017. 2. IN GROUND NO. 1, THE REVENUE HAS CHALLENGED THE ACTION OF THE LD CIT(APPEALS) IN DELETING THE ADDITION OF RS.29,53,9 95/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF THE ALLEGED UNDISCL OSED PROFIT FROM DHAIRYA COMMODITIES PVT. LIMITED. 3. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY, W HICH IS ENGAGED IN THE BUSINESS OF PROCESSING AND SALE OF EDIBLE OIL A ND CULTIVATION AND SALE OF MEDICINAL PLANTS AND HERBAL PRODUCTS. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY IT ON 30.09.2 011 DECLARING A TOTAL ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 2 INCOME OF RS.1,39,00,760/-. AS PER THE INFORMATION RECEIVED BY THE ASSESSING OFFICER FROM DDIT (I&CI), KOLKATA, THE AS SESSEE DURING THE YEAR UNDER CONSIDERATION HAD MADE TRANSACTIONS WITH NATI ONAL MULTI COMMODITY EXCHANGE, AHMEDABAD AND HAD BOOKED A PROF IT OF RS.8,85,36,587/- ON SUCH TRANSACTIONS MADE THROUGH BROKER DHAIRYA COMMODITIES PVT. LIMITED. AS FOUND BY THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS, A PROFIT ONLY RS. 8,55,82,593/- WAS DECLARED BY THE ASSESSEE-COMPANY IN ITS RETURN OF I NCOME. WHEN THE ASSESSEE WAS CALLED UPON BY THE ASSESSING OFFICER T O EXPLAIN THE DIFFERENCE OF RS.29,53,995/-, A COPY OF LEDGER ACCO UNT SHOWING THE TRANSACTIONS WITH DHAIRYA COMMODITIES PVT. LIMITED WAS SUBMITTED BY THE ASSESSEE TO SHOW THAT THE NET PROFIT OF RS.8,55,82, 593/- ONLY AS SHOWN WAS EARNED BY IT. THIS EXPLANATION OF THE ASSESSEE WAS NOT FOUND ACCEPTABLE BY THE ASSESSING OFFICER AND RELYING ON THE INFORMATION RECEIVED BY HIM FROM DDIT (I&CI), KOLKATA, HE ADDED THE DIFFERENCE AMOUNT OF RS.29,53,995/- TO THE TOTAL INCOME OF THE ASSESSEE BY TREATING THE SAME AS THE UNDISCLOSED PROFIT OF THE ASSESSEE. 4. THE ADDITION OF RS.29,53,995/- MADE BY THE ASSES SING OFFICER ON ACCOUNT OF THE ALLEGED UNDISCLOSED PROFIT RECEIVED FROM THE BROKER DHAIRYA COMMODITIES PVT. LIMITED WAS CHALLENGED BY THE ASSESSEE IN THE APPEAL FILED BEFORE THE LD. CIT(APPEALS) AND AFTER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE AS WELL AS THE MAT ERIAL AVAILABLE ON RECORD INCLUDING THE REMAND REPORT SUBMITTED BY THE ASSESSING OFFICER, THE LD. CIT(APPEALS) DELETED THE ADDITION OF RS.29, 53,995/- MADE BY THE ASSESSING OFFICER ON THIS ISSUE FOR THE FOLLOWING R EASONS GIVEN IN PARAGRAPHS NO. 3 & 4 OF HIS IMPUGNED ORDER:- 3. I HAVE CAREFULLY EXAMINED THE SUBMISSIONS MADE BY THE LD. AO DURING THE ASSESSMENT AS WELL AS IN THE REMA ND REPORT. THE BRIEF FACTS ARE THAT LD. AO HAD RECEIVED CERTAI N INFORMATION FROM DDIT [I & CI], KOLKATA WHEREIN IT WAS STATED THE APPELLANT HAS EVADED TAX ON TRANSACTIONS WITH N ATIONAL MULTI COMMODITY EXCHANGE [NCMEX], AHMEDABAD. FURTHE R, FIGURES OF PROFIT AMOUNTING TO RS.8,85,36,587/- WAS ALSO REPORTED IN THE SAID INFORMATION RECEIVED. HOWEVER, FROM THE ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 3 DOCUMENTS SUBMITTED BEFORE THE LD.AO AS WELL AS IN APPEAL, IT IS OBSERVED THAT THE APPELLANT-COMPANY HAD DULY REC ORDED THE ABOVE TRANSACTIONS IN ITS REGULAR BOOKS OF ACCOUNTS . THE ONLY ISSUE NOW REMAINS TO BE SEEN IS THAT AS PER THE REP ORT FROM DDIT, PROFIT OF RS.8,85,36,587/- IS BEING REFLECTED WHEREAS AS PER THE BOOKS OF ACCOUNTS OF THE APPELLANT, PROFIT OF RS.8,55,82,593/- IS BEING REFLECTED. THE APPELLANT IN ORDER TO SUBSTANTIATE ITS TRANSACTIONS HAS DULY OFFERED COPY OF LEDGER OF BROKER I.E. M/S DHAIRYA COMMODITIES PVT. LTD. IN THE BOOKS OF APPELLANT, WHICH SHOWS PROFIT EARNED DURING THE FINANCIAL YEAR WAS RS.8,55,82,593/- ONLY. FURTHER, APPELLANT HAS ALSO SUBMITTED COPY OF LEDGER OF THE APPELLANT COMPANY M AINTAINED IN THE BOOKS OF DHAIRYA COMMODITIES PVT. LTD. ON PE RUSAL OF BOTH THE LEDGERS, IT IS SEEN THAT INCOME EARNED BY APPELLANT IS RS.8,55,82,593/- ONLY, AND NOT THE IMPUGNED FIGURE AS REPORTED IN THE REPORT OF THE LD. DDIT, WHICH HAS B EEN RELIED UPON BY THE LD.AO. 4. IT IS FURTHER OBSERVED THAT ALL THE TRANSACTION S WERE DULY SETTLED BY BANK AND DULY RECORDED IN THE BOOKS OF ACCOUNTS OF THE APPELLANT AS IS EVIDENT FROM THE DE TAILS AS SUBMITTED BY APPELLANT. THUS, I AM NOT ABLE TO AGRE E WITH THE CONTENTION OF THE LD. AO THAT THAT MERELY BECAUSE T HE DDIT REPORT STATES THAT THE AMOUNT OF UNDISCLOSED INCOME OF RS.8,55,82,593/-, THE SAME NEEDS TO BE TAKEN WITHOU T FURTHER VERIFICATION. IN ANY CASE, THE LD. AO HAS NOT ADDED THE ENTIRE FIGURE ON THE BASIS OF THE ALLEGATION; HE HAS MEREL Y ADDED BACK THE IMPUGNED DIFFERENCE OF THE FIGURES. I FIND THAT THIS HAS BEEN DONE RATHER MECHANICALLY AND THE APPELLANT 'S SUBMISSIONS DURING THE APPEAL PROCEEDINGS HAVE NOT BEEN SPECIFICALLY COMMENTED UPON BY THE LD.AO. ON THE OT HER HAND, THE APPELLANT HAS BEEN ABLE TO DOCUMENT AND SUPPORT ITS TRANSACTIONS FOR THE AMOUNTS STATED, AND THE SAME H AVE NOT BEEN DISPUTED BY THE LD. AO. AS SUCH, IN A SITUATIO N WHERE THE LD. AO HAS MADE ANY ADDITION, THE REASONS FOR SUCH ADDITION [BASED ON A MERE DIFFERENCE OF FIGURES AS SUPPLIED TO HIM BY THE LD. DDIT WERE TO BE EVIDENCED ON RECORDS, AND M ERE DEPENDENCE ON THE FIGURE OF THE DDIT WOULD NOT BE A DEQUATE IN MY CONSIDERED OPINION, TO WARRANT ANY ADDITION, ESPECIALLY IN A SITUATION WHERE THE ENTIRE TRANSACTIONS HAS BE EN FOUND ACCEPTABLE. THE LD. A.O'S ADDITION IN ASSESSMENT ST AGE AND SUBMISSIONS IN REMAND ARE NOT SUPPORTED BY ANY OF T HE SURROUNDING AND RELEVANT FACTORS AND CONSIDERATIONS OR THE PRINCIPLES OF EVIDENCE AND LAW. QUITE ON THE CONTRA RY, I FIND THAT AS THE DETAILS OF TRANSACTIONS AS DISCLOSED BY THE APPELLANT-COMPANY ARE SUPPORTED BY SUFFICIENT DIREC T EVIDENCE AND WARRANT NO ADDITION BASED ON UNSUBSTANTIATED FI GURES. THUS, IN MY CONSIDERED VIEW OF THE MATTER I FIND ME RIT IN THE SUBMISSION OF THE APPELLANT. THE APPELLANT IS ELIGI BLE TO BE RELIVED OF THE ADDITION, AND ACCORDINGLY THIS GROUN D OF APPEAL STANDS ALLOWED. ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 4 5. THE LD. D.R. SUBMITTED THAT AS PER THE SPECIFIC INFORMATION RECEIVED BY THE ASSESSING OFFICER, PROFIT ON THE RELEVANT TR ANSACTIONS MADE WITH NATIONAL MULTI COMMODITY EXCHANGE THROUGH BROKER DH AIRYA COMMODITIES PVT. LIMITED WAS MORE BY RS.29,53,995/- THAN THE PR OFIT DECLARED BY THE ASSESSEE COMPANY IN ITS RETURN OF INCOME AND SINCE THE ASSESSEE COULD NOT OFFER ANY SATISFACTORY EXPLANATION IN RESPECT OF TH E SAID DIFFERENCE, THE ASSESSING OFFICER RIGHTLY TREATED THE SAME AS THE U NDISCLOSED PROFIT OF THE ASSESSEE. HE SUBMITTED THAT EVEN DURING THE COURSE OF REMAND PROCEEDINGS BEFORE THE ASSESSING OFFICER, THE ASSES SEE COULD NOT EXPLAIN THE SAID DIFFERENCE INSPITE OF SUFFICIENT OPPORTUNI TY AFFORDED BY THE ASSESSING OFFICER. HE CONTENDED THAT THE LD. CIT(AP PEALS), HOWEVER, DID NOT APPRECIATE THIS POSITION AND DELETED THE ADDITI ON MADE BY THE ASSESSING OFFICER ON THIS ISSUE BY PUTTING THE ONU S ON THE DEPARTMENT WHEREAS THE ONUS TO EXPLAIN THE DIFFERENCE WAS ACTU ALLY ON THE ASSESSEE. 6. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, SUBMITTED THAT THE ALLEGATION WAS LEVELLED AGAINST THE ASSESSEE RE GARDING EVASION OF TAX ON THE PROFIT BOOKED IN THE TRANSACTIONS WITH NATIO NAL MULTI COMMODITY EXCHANGE IN THE INFORMATION RECEIVED BY THE ASSESSI NG OFFICER FROM DDIT (I&CI), KOLKATA. HE SUBMITTED THAT THE SAID REPORT OF INVESTIGATION WING WAS NEVER GIVEN BY THE ASSESSEE AND THE ASSESSEE WA S ONLY REQUIRED TO EXPLAIN THE DIFFERENCE, WHICH WAS ALLEGEDLY THERE I N THE PROFIT DECLARED BY THE ASSESSEE. HE INVITED OUR ATTENTION TO THE RELEV ANT DETAILS FURNISHED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER DURING TH E COURSE OF ASSESSMENT PROCEEDINGS AT PAGE NO. 20 OF THE PAPER BOOK TO SHO W THAT THE NET PROFIT OF RS.8,55,82,593/- WAS ACTUALLY EARNED BY THE ASSE SSEE THROUGH DHAIRYA COMMODITIES PVT. LIMITED. HE ALSO INVITED OUR ATTEN TION TO THE COPY OF RELEVANT LEDGER ACCOUNT PLACED AT PAGE NO.25 TO SHO W THAT THE PROFIT EARNED BY THE ASSESSEE FROM THE TRANSACTIONS MADE T HROUGH DHAIRYA COMMODITIES PVT. LIMITED WAS ONLY RS.655.82 LAKHS A ND NOT RS.885.36 LAKHS AS STATED TO BE REPORTED BY THE INVESTIGATION WING. HE CONTENDED ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 5 THAT THE ASSESSEE IS NOT AWARE AS TO HOW THE FIGURE OF RS.885.36 LAKHS WAS ARRIVED AT EITHER BY THE ASSESSING OFFICER OR BY TH E INVESTIGATION WING. HE CONTENDED THAT THE RELEVANT DETAILS OF THE SAID FIG URE WERE NEVER GIVEN TO THE ASSESSEE AND NO ENQUIRY WHATSOEVER WAS MADE BY THE ASSESSING OFFICER FROM DHAIRYA COMMODITIES PVT. LIMITED TO FI ND OUT THE EXACT AMOUNT OF PROFIT. HE CONTENDED THAT THE ADDITION MA DE BY THE ASSESSING OFFICER ON THIS ISSUE WAS THUS NOT WELL FOUNDED AND THE LD. CIT(APPEALS) WAS FULLY JUSTIFIED IN DELETING THE SAME. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ALS O PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS OBSERV ED THAT CERTAIN INFORMATION WAS RECEIVED BY THE ASSESSING OFFICER F ROM THE INVESTIGATION WING RELATING TO THE ALLEGED TAX EVASION BY THE ASS ESSEE ON THE PROFITS BOOKED ON THE TRANSACTIONS WITH NATIONAL MULTI COMM ODITY EXCHANGE. THE AMOUNT OF SUCH PROFIT WAS REPORTED AT RS.8,85,36,58 8/-. THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS , HOWEVER, FOUND THAT THE PROFIT ON THE RELEVANT TRANSACTIONS WAS DULY DE CLARED BY THE ASSESSEE IN THE RETURN OF INCOME AT RS.8,55,82,593/-. THERE WAS THUS A DIFFERENCE OF RS.29,53,995/- IN THE PROFIT REPORTED BY THE INV ESTIGATION WING AND THE PROFIT DECLARED BY THE ASSESSEE AND WHEN THE ASSESS EE WAS REQUIRED TO EXPLAIN THIS DIFFERENCE, COMPLETE DETAILS OF THE RE LEVANT TRANSACTIONS WERE FURNISHED BY THE ASSESSEE TO SHOW THAT THE PROFIT A CTUALLY EARNED BY HIM WAS ONLY RS.8,55,82,593/-. A COPY OF RELEVANT LEDGE R ACCOUNT WAS ALSO FILED BY THE ASSESSEE TO SHOW THAT THE ACTUAL PROFI T ONLY RS.8,55,82,593/- WAS EARNED ON THE RELEVANT TRANSACTIONS BOOKED THRO UGH BROKER DHAIRYA COMMODITIES PVT. LIMITED. THIS RELEVANT INFORMATION FURNISHED BY THE ASSESSEE-COMPANY IN SUPPORT OF ITS CLAIM, HOWEVER, WAS BRUSHED ASIDE BY THE ASSESSING OFFICER AND THE DIFFERENCE OF RS.29,5 3,995/- WAS ADDED BY HIM BY TREATING THE SAME AS UNDISCLOSED PROFIT OF T HE ASSESSEE WITHOUT GIVING ANY BASIS AS TO HOW THE PROFIT OF RS.8,85,36 ,587/- WAS ARRIVED AT AS REPORTED BY THE INVESTIGATION WING. HE ALSO DID NOT MAKE ANY ENQUIRY FROM THE NATIONAL MULTI COMMODITY EXCHANGE, AHMEDAB AD OR EVEN FROM ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 6 THE CONCERNED BROKER DHAIRYA COMMODITIES PVT. LIMIT ED TO FIND OUT THE FACTUAL POSITION. KEEPING IN VIEW ALL THESE FACTS A ND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT THE ADDITION MADE BY THE ASSESSING OFFICER ON THIS ISSUE WAS NOT SUSTAINABLE AND THE LD. CIT(A PPEALS) WAS FULLY JUSTIFIED IN DELETING THE SAME. IN THAT VIEW OF THE MATTER, WE UPHOLD THE IMPUGNED ORDER OF THE LD. CIT(APPEALS) ON THIS ISSU E AND DISMISS GROUND NO. 1. 8. IN GROUNDS NO. 2 TO 5, THE REVENUE HAS CHALLENGE D THE ACTION OF THE LD. CIT(APPEALS) IN ACCEPTING THE CLAIM OF THE ASSE SSEE OF SALES TAX INCENTIVES OF RS.24,94,66,520/- AS CAPITAL RECEIPT ALTHOUGH THE SAME WAS DECLARED BY THE ASSESSEE AS REVENUE RECEIPT IN THE RETURN OF INCOME. 9. DURING THE YEAR UNDER CONSIDERATION, THE ASSESES E-COMPANY HAD RECEIVED INCENTIVES OF RS.24,94,66,520/- IN THE FOR M OF SALES TAX ASSISTANCE AS INDUSTRIAL PROMOTIONAL ASSISTANCE (IP A) UNDER THE WEST BENGAL INCENTIVE SCHEME, 2004. THE SAID INCENTIVE W AS SET OFF BY THE ASSESSEE AGAINST THE SALES TAX LIABILITY PAYABLE TO THE GOVERNMENT AND NET AMOUNT WAS CREDITED TO THE PROFIT & LOSS ACCOUNT IN THE BOOKS OF ACCOUNT. IN THE COMPUTATION OF TOTAL INCOME FILED ALONG WITH THE RETURN OF INCOME, THE SAID AMOUNT WAS NOT EXCLUDED BY THE ASSESSEE WH ILE COMPUTING THE TOTAL INCOME UNDER THE NORMAL PROVISIONS OF THE ACT AS WELL AS THE BOOK PROFIT UNDER SECTION 115JB OF THE ACT. EVEN DURING THE COURSE OF ASSESSMENT PROCEEDINGS, NO SUCH CLAIM WAS MADE BY T HE ASSESSEE FOR THE EXCLUSION OF INCENTIVE AMOUNT BEING CAPITAL RECEIPT . AFTER REALISING THIS INADVERTENT AND BONAFIDE MISTAKE, A CLAIM WAS MADE BY THE ASSESESE FOR THE FIRST TIME BEFORE THE LD. CIT(APPEALS) THAT THE INCENTIVE IN THE FORM OF SALES TAX ASSISTANCE RECEIVED AS INDUSTRIAL PROMOTI ONAL ASSISTANCE WAS FOR EXPANSION OF EXISTING INDUSTRIAL UNDERTAKING INVOLV ING HUGE CAPITAL OUTLAYS AND THE SAME BEING CAPITAL RECEIPT WAS LIAB LE TO BE EXCLUDED WHILE COMPUTING THE TOTAL INCOME UNDER THE NORMAL PROVISI ONS OF THE ACT AS WELL AS THE BOOK PROFIT UNDER SECTION 115JB OF THE ACT. IT WAS CONTENDED ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 7 ON BEHALF OF THE ASSESSEE BEFORE THE LD. CIT(APPEAL S) THAT IT WAS PERMISSIBLE TO MAKE SUCH FRESH CLAIM FOR THE FIRST TIME DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT(APPEAL S) AND IN SUPPORT OF THIS CONTENTION, RELIANCE WAS PLACE ON BEHALF OF TH E ASSESESE ON THE FOLLOWING JUDICIAL PRONOUNCEMENTS:- 2.1. IN JUTE CORPORATION OF INDIA LTD. - VS. - CIT (1991) 187 ITR 688 (SC)- THREE JUDGE BENCH OF THE APEX COURT R ELIED UPON THE EARLIER THREE JUDGE BENCH DECISION IN THE CASE OF CIT -VS.- KANPUR COAL SYNDICATE (1964) 53 ITR 225 (SC) (IN TH E CONTEXT OF SECTION 31(3)(A) OF THE 1922 ACT WHICH CORRESPON DS TO SEC. 251(1)(A) OF THE 1961 ACT), WHERE IT HAS BEEN HELD THAT THE APPELLATE COMMISSIONER HAS PLENARY POWER IN DISPOSI NG OFF AN APPEAL. THE APEX COURT IN JUTE CORPORATION (SUPRA), BASED O N THE ABOVE, FURTHER HELD, IN THE CONTEXT OF SECTION 251( 1)(A) OF THE 1961 ACT, THAT THERE IS NO REASON AS TO WHY THE APP ELLATE COMMISSIONER CANNOT MODIFY THE ASSESSMENT ORDER OR ADMIT AN ADDITIONAL GROUND EVEN IF NOT RAISED BEFORE THE ITO . ACCORDING TO THE APEX COURT, NO EXCEPTION COULD BE TAKEN TO T HIS VIEW AS THE ACT DOES NOT PLACE ANY RESTRICTION OR LIMITATIO N ON THE EXERCISE OF APPELLATE POWER. SIMILAR VIEWS HAVE BEE N HELD IN CIT V. NIRBHERAM DALURAM [1997] 224 ITR 610 (SC). 2.2 IN ADDL. CIT -VS.- GURJARQRAVURES P. LTD. (1978 ) 111 ITR 1 (SC). A TWO JUDGE BENCH OF THE APEX COURT HAD TAKEN A DIFFERENT VIEW HOLDING THAT, IN ABSENCE OF ANY CLAIM MADE BY THE ASSESSEE BEFORE THE A.O., HE IS NOT ENTITLED TO RAISE THE CL AIM BEFORE THE APPELLATE COMMISSIONER, WHEN NO MATERIAL WERE ON RE CORD. HOWEVER, THE THREE JUDGE BENCH OF THE APEX COURT IN THE CASE OF JUTE CORPORATION (SUPRA) TOOK NOTE OF THE ABOVE VIE W AND OBSERVED THAT THE SAID VIEW IS IN CONFLICT WITH THE VIEW TAKEN BY THE THREE JUDGE BENCH OF THE APEX COURT IN THE CASE OF KANPUR COAL (SUPRA). IT IS ALSO NOTED THAT THE DECISION OF KANPUR COAL (SUPRA) WAS NOT BROUGHT TO THE NOTICE OF THE TWO JU DGE BENCH IN GURJARGRAVURES (SUPRA). HENCE, IT WAS FURTHER HELD THAT THE VIEW OF THE LARGER BENCH IN KANPUR COAL (SUPRA) WOU LD HOLD THE FIELD AND THE DECISION OF THE GURJARGRAVURES (SUPRA ) IS TO BE UNDERSTOOD IN THE CONTEXT OF THE SPECIAL FACTS OF T HE SAID CASE. THE APEX COURT FURTHER HELD THAT THERE COULD BE SEV ERAL FACTORS JUSTIFYING A NEW PLEA BEFORE THE APPELLATE COMMISSI ONER. IF THE APPELLATE COMMISSIONER IS SETTSNEA, HE WOULD BE ACT ING WITHIN HIS JURISDICTION IN CONSIDERING THE NEW CLAIM IN AL L ITS ASPECTS. WHILE PERMITTING THE ADDITIONAL GROUND HE MUST BE S ATISFIED THAT THE GROUND RAISED WAS BONAFIDE AND THAT THE SA ME COULD NOT HAVE BEEN RAISED EARLIER FOR GOOD REASONS. ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 8 2.3 THE ABOVE DECISION OF THE APEX COURT IN THE JUT E CORPORATION (SUPRA) HAS BEEN FOLLOWED IN THE SUBSEQ UENT DECISION OF NATIONAL THERMAL POWER CO. LTD. -VS.- C IT (1998) 229 ITR 383(SC), TO HOLD THAT, WHERE A TRIBUNAL IS ONLY REQUIRED TO CONSIDER A QUESTION OF LAW ARISING FROM THE FACT S, WHICH ARE ON RECORDS, THERE IS NO REASON WHY SUCH QUESTION SH OULD NOT BE ALLOWED TO BE RAISED WHEN IT IS NECESSARY TO CONSID ER THAT QUESTION IN ORDER TO CORRECTLY ASSESS THE TAX LIABI LITY OF THE ASSESSEE. 2.4 THE LATEST DECISION OF THE APEX COURT IN THE CA SE OF GOETZE INDIA) LTD. -VS.- CIT (2006) 284 ITR 323 (SC). THE APEX COURT DEALT WITH THE POWER OF THE A O. TO ENTERTAIN A CLA IM MADE BEFORE THE A.O., OTHERWISE THAN THROUGH REVISED RET URN FILED ON TIME AND HELD THAT SUCH CLAIM CANNOT BE ENTERTAINED BY AO. HOWEVER, WHILE CONCLUDING, THE APEX COURT MADE IT A BUNDANTLY CLEAR THAT THE SAID DECISION DOESN'T AFFECT THE POW ER OF THE TRIBUNAL TO ADMIT ADDITIONAL GROUND. SAME IS THE CA SE AS REGARDS APPEAL BEFORE COMMISSIONER APPEALS. 2.5. APPELLATE COMMISSIONER HAS POWER WIDER THAT TH OSE OF AN APPELLATE COURT UNDER THE CODE OF CIVIL PROCEDURE - BIPLN LAL KUTHIALA -VS,- CIT (1957) 32 ITR 361 (PUNE). HIS CO MPETENCE IS NOT RESTRICTED TO DEALING WITH SUBJECT MATTER OF AP PEAL. 2.6. POWER OF APPELLATE ASSISTANT COMMISSIONER IS W IDER THAN THAT OF TRIBUNAL. THE POWERS OF THE TRIBUNAL ARE CO NFINED TO THE SUBJECT MATTER OF APPEAL. HOWEVER, THE POWERS OF AP PELLATE COMMISSIONER ARE NOT CONFINED TO THE SUBJECT MATTER OF APPEAL BUT EXTEND TO THE ENTIRE SUBJECT MATTER OF ASSESSME NT AS HELD IN CASE OF HUKUMCHAND MILLS LTD. -VS,- CIT (1967) 63 I TR 232 (SC). 2.7. THE PRINCIPLES LAID DOWN IN THE APEX COURT DEC ISION HAVE BEEN RELIED UPON BY HON'BLE GUJ. HE IN THE CASE OF CIT -VS.- SAYAJJ MILLS LTD. (1974) 94 ITR 26 - WHEREIN IT HAS BEEN HELD THAT ALL QUESTIONS, WHETHER OF LAW OR OF FACT, WHIC H RELATES TO THE ASSESSMENT OF THE ASSESSEE, MAY ORDINARILY BE A LLOWED TO BE RAISED BY THE ASSESSEE IN APPEAL, EVEN THOUGH THEY MAY NOT HAVE BEEN RAISED BEFORE THE ITO, IF GRANT OF RELIEF WOUL D BE AVAILABLE TO HIM ON DETERMINATION OF SUCH QUESTION. SIMILAR P RINCIPLE ALSO APPROVED IN THE CASE OF CIT -VS,- CELLULOSE PRODUCT S INDJA LTD. (1985) 151 ITR 499 (GUJ - HC - FB), 2.8. SUPREME COURT IN JUTE CORPORATION LTD. (SUPRA) SPECIFICALLY APPROVED THE DECISION OF JURISDICTIONAL CALCUTTA HI GH COURT IN RAJKUMAR SRJMAL -VS.- CIT (1976) 102 ITR 525 (CAL. ), WHERE IT HAS BEEN HELD THAT, THE APPELLATE COMMISSIONER WAS ENTITLED TO ADMIT NEW GROUND OR EVIDENCE EITHER SUO MOTO OR AT THE INVITATION OF THE APPELLANT. 2.9. IN THIS REGARDS CENTRAL BOARD OF REVENUE (NOW CBDT) VIDE CIRCULAR NO. 14 (XL - 35) OF 1955 DATED 11-04-1955, STATES THAT, ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 9 OFFICERS OF THE DEPARTMENT MUST NOT TAKE ADVANTAGE OF THE IGNORANCE OF AN ASSESSEE AS TO HIS RIGHTS. IT IS ON E OF THEIR DUTIES TO ASSIST A TAXPAYER IN EVERY WAY PARTICULAR LY IN THE MATTER OF CLAIMING AND SECURING RELIEF. ALTHOUGH TH EREFORE THE RESPONSIBILITY FOR CLAIMING REFUNDS AND RELIEF REST S WITH THE ASSESSEE ON WHOM IT IS IMPOSED BY LAW, OFFICERS SHO ULD DRAW THEIR ATTENTION TO ANY REFUNDS OR RELIEF TO WHICH T HEY APPEAR TO BE CLEARLY ENTITLED BUT WHICH THEY HAVE OMITTED TO CLAIM FOR SOME REASON OR OTHER. 2.10. IN THIS REGARD RELIANCE CAN ALSO BE PLACED O N THE DECISION IN CASE OF PRUTHVJ BROKERS & SHAREHOLDERS PVT. LTD. 349 ITB 336 (BORN HC1. WHEREIN IT HAS BEEN HELD BY HON' BLE HIGH COURT THAT IT IS A WELL SETTLED PRINCIPLE THAT ASSE SSEE IS ENTITLED TO RAISE NOT MERELY ADDITIONAL LEGAL SUBMISSIONS BE FORE THE APPELLATE AUTHORITIES, BUT IS ALSO ENTITLED TO RAIS E ADDITIONAL CLAIMS BEFORE THEM. 10. THE LD. CIT(APPEALS) FOUND MERIT IN THE CONTENT ION RAISED ON BEHALF OF THE ASSESSEE-COMPANY AND ADMITTED THE NEW CLAIM OF THE ASSESSEE FOR ADJUDICATION ON MERIT BY OBSERVING AS UNDER:- 15. THE SUBMISSIONS OF THE APPELLANT WERE DULY CON SIDERED AND FOUND TO BE ACCEPTABLE. THE VARIOUS JUDICIAL PRONOUNCEMENTS REFERRED TO BY THE APPELLANT / LD. A .R IN MY CONSIDERED OPINION ARE DIRECTLY APPLICABLE TO IT S CASE. MOREOVER, I FIND THAT THE DECISION OF THE HON'BLE B OMBAY HIGH COURT IN THE CASE OF PRUTHVI BROKERS & SHAREHO LDERS LTD IN ITA NO. 3908 OF 2010 IS ALSO RELEVANT, WHERE IN IT WAS HELD THAT THE TAXPAYER IS ENTITLED TO CLAIM THE DED UCTION BEFORE THE APPELLATE AUTHORITIES WHICH WAS NOT CLAI MED IN THE ORIGINAL OR REVISED INCOME-TAX RETURN. THE AFOR ESAID DECISION WAS RENDERED AFTER CONSIDERING THE APEX CO URT'S DECISION IN THE CASE OF GOETZE INDIA. THE HON'BLE C OURT OBSERVED THAT APEX COURT HAD MADE IT CLEAR THAT ISS UE IN THE CASE WAS LIMITED TO THE POWER OF THE ASSESSING AUTHORITY AND THE JUDGMENT DOES NOT IMPINGE ON THE POWER OF T HE APPELLATE AUTHORITIES TO ENTERTAIN AND ALLOW ADDITI ONAL CLAIM. THE APPELLANT IS ENTITLED TO MAKE A FRESH CL AIM WHICH HAS NOT BEEN MADE IN THE RETURN OF INCOME OR FILED BEFORE ASSESSING OFFICER AS APPELLATE COMMISSIONER HAS THE POWER TO MODIFY THE ASSESSMENT ORDER OR ADMIT AN ADDITION AL GROUND EVEN IF NOT RAISED BEFORE THE INCOME TAX OFF ICER. THUS, THE FRESH CLAIM WAS FOUND TO BE ADMISSIBLE TO BE ADJUDICATED ON MERITS. 11. IN SUPPORT OF ITS CLAIM THAT THE AMOUNT IN QUES TION RECEIVED AS SALES TAX INCENTIVE WAS IN THE NATURE OF CAPITAL RECEIPT NOT CHARGEABLE TO TAX, IT WAS SUBMITTED BY THE ASSESSEE BEFORE THE LD. CIT(AP PEALS) ON MERIT THAT ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 10 THE SAID AMOUNT WAS RECEIVED UNDER THE WEST BENGAL INCENTIVE SCHEME, 2004 ISSUED VIDE NOTIFICATION NO. 134-CI/O/INCENTIV E/17/03/I DATED 24.03.2004. IT WAS SUBMITTED THAT THE SAID SCHEME W AS INTRODUCED WITH THE OBJECTIVE TO ENCOURAGE SETTING UP OF NEW INDUST RIES OR EXPANSION OF THE EXISTING INDUSTRIES IN THE BACKWARD AREAS OF TH E STATE OF WEST BENGAL. IT WAS SUBMITTED ON BEHALF OF THE ASSESSEE-COMPANY THAT ITS HALDIA MANUFACTURING UNIT WAS SITUATED IN THE MIDNAPORE DI STRICT IN THE STATE OF WEST BENGAL, WHICH WAS CATEGORISED AS BACKWARD AREA IN THE SCHEME. IT WAS SUBMITTED THAT IN LINE WITH AND TO ACHIEVE THE OBJECTIVES STATED IN THE SAID SCHEME, THE ASSESSEE-COMPANY HAD MADE EXPANSIO N OF ITS EXISTING UNIT AT HALDIA INVOLVING A HUGE CAPITAL OUTLAY OF R S.168 CRORES. IT WAS SUBMITTED THAT THE ASSESSEE-COMPANY WAS ENTITLED TO IPA OF 75% OF SALES TAX PAID SUBJECT TO THE MAXIMUM LIMIT OF 100% OF TH E FIXED CAPITAL INVESTMENT. IT WAS SUBMITTED THAT THE ASSESSEE-COMP ANY THUS WAS ENTITLED FOR SUCH SUBSIDY IN THE FORM OF SALES TAX INCENTIVE TO THE EXTENT OF RS.168 CRORES AND DURING THE YEAR UNDER CONSIDERATION, IT HAD AVAILED THE SAID BENEFIT TO THE EXTENT OF RS.24,96,64,520/- AS PER T HE ELIGIBILITY CERTIFICATE ISSUED BY THE WBIDC LIMITED. IT WAS CONTENDED THAT THE INCENTIVE IN THE FORM OF SALES TAX SUBSIDY THUS WAS GRANTED UNDER TH E SCHEME FOR THE EXPANSION OF ASSESSEES MANUFACTURING UNIT SITUATED IN THE BACKWARD AREAS AND SINCE THE SAID INCENTIVE WAS GRANTED TO E NCOURAGE THE INDUSTRIAL GROWTH OF INDUSTRIALLY BACKWARD AREAS, I T WAS IN THE NATURE OF A CAPITAL RECEIPT NOT CHARGEABLE TO TAX. 12. RELIANCE WAS PLACED ON BEHALF OF THE ASSESSEE O N THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SAHNEY STEEL W ORKS LIMITED VS.- CIT [228 ITR 253], WHEREIN IT WAS HELD THAT IF THE OBJECT OF THE ASSISTANCE UNDER THE SUBSIDY SCHEME WAS TO ENABLE THE ASSESSEE TO SET UP A NEW UNIT OR EXPAND THE EXISTING UNIT, THEN THE RECEIPT WAS O N CAPITAL ACCOUNT. RELIANCE WAS ALSO PLACED BY THE ASSESSEE ON THE DEC ISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS.- RASOI LIMITED [335 ITR 438], WHEREIN IT WAS HELD THAT THE INCENTIVE GRANTED TO E NABLE THE SPECIFIED ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 11 INDUSTRY TO SET UP NEW UNITS, EXPAND THEIR CAPACITI ES, MODERNISE THEIR BUSINESS, ETC. WAS A CAPITAL RECEIPT AND MERELY BEC AUSE INCENTIVE WAS PAID BY WAY OF REFUND OF SALES TAX, IT DID NOT AMOUNT TO REVENUE RECEIPT. VARIOUS OTHER CASE LAWS WERE ALSO CITED ON BEHALF O F THE ASSESSEE IN SUPPORT OF ITS CONTENTION THAT FOR DETERMINING THE NATURE OF SUBSIDY IN THE HANDS OF THE ASSESSEE, THE PURPOSE AND OBJECTIVE OF THE SCHEME UNDER WHICH THE SUBSIDY WAS GIVEN IS OF FUNDAMENTAL IMPOR TANCE AND IT IS ALONE THE ULTIMATE DECIDING FACTOR. IT WAS CONTENDED THAT SINCE THE INCENTIVE IN QUESTION IN THE FORM OF SALES TAX SUBSIDY WAS GRANT ED FOR EXPANSION OF CAPACITIES IN BACKWARD AREAS OF THE STATE, THE SAME WAS CAPITAL IN NATURE NOT CHARGEABLE TO TAX. 13. AS REGARDS THE TREATMENT TO BE GIVEN TO THE SAL ES TAX SUBSIDY WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF TH E ACT, IT WAS CONTENDED ON BEHALF OF THE ASSESSEE THAT THE SALES TAX SUBSIDY BEING A PURE CAPITAL RECEIPT NOT HAVING ANY ELEMENT OF INC OME OR PROFIT EMBEDDED THEREIN WAS NOT CHARGEABLE TO TAX UNDER TH E INCOME TAX ACT, 1961 AND THE SAME, THEREFORE, WAS LIABLE TO BE EXCL UDED EVEN WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF TH E ACT. IN SUPPORT OF THIS CONTENTION, RELIANCE WAS PLACED BY THE ASSESSE E ON THE DECISION OF THE KOLKATA BENCH OF THE ITAT IN THE CASE OF BENANI IND USTRIES LIMITED VS.- DIT [178 TTJ 658], WHEREIN IT WAS HELD THAT CAPITAL RECEIPT IN THE FORM OF SALES TAX INCENTIVE WAS REQUIRED TO BE EXCLUDED WHI LE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF THE ACT. RELIANCE WAS ALSO PLACED ON BEHALF OF THE ASSESSEE ON THE DECISION OF THE MUMBAI BENCH OF ITAT IN THE CASE OF ITO VS.- FRIGSALES (INDIA) LIMITED [4 SOT 376], WHEREIN IT WAS HELD THAT THE AMOUNTS WHICH ARE NOT TAXABLE IN THE NORMA L COMPUTATION CANNOT BE INCLUDED WHILE COMPUTING BOOK PROFIT BECAUSE SUC H AMOUNTS DID NOT REALLY REFLECT A RECEIPT IN THE NATURE OF INCOME AN D CANNOT FORM PART OF THE BOOK PROFIT. ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 12 14. THE ENTIRE SUBMISSIONS MADE ON BEHALF OF THE AS SESSEE IN SUPPORT OF ITS NEW CLAIM MADE FOR THE FIRST TIME BEFORE HIM WE RE FORWARDED BY THE LD. CIT(APPEALS) TO THE ASSESSING OFFICER FOR HIS E XAMINATION. AFTER EXAMINING THE DETAILS AND DOCUMENTS FURNISHED BY TH E ASSESSEE, A REMAND REPORT DATED 12.06.2017 WAS SUBMITTED BY THE ASSESS ING OFFICER TO THE LD. CIT(APPEALS). IN THE SAID REMAND REPORT, REASONS WE RE GIVEN BY THE ASSESSING OFFICER ELABORATELY IN SUPPORT OF HIS STA ND THAT THE CLAIM OF THE ASSESSEE THAT THE INCENTIVE RECEIVED IN THE FORM OF SUBSIDY WAS A CAPITAL RECEIPT WAS NOT ACCEPTABLE. THE SAID REASONS AS SUM MARIZED BY THE ASSESSING OFFICER IN HIS REMAND REPORT WERE AS UNDE R:- THE ASSESSEE ITSELF HAS TREATED SUCH RECEIPT AS A REVENUE RECEIPT IN THE AUDITED PROFIT & LOSS ACCOUNT AND RE TURN OF INCOME FOR THE AY 2011-12. (II) THIS ACCOUNTING TREATMENT OF THE SUBSIDY HAS B EEN CERTIFIED BY THE AUDITORS OF THE COMPANY (M/S. S.K. AGRAWAL & CO., CHARTERED ACCOUNTANTS) AND HAS COMMENTED IN NOTE 20 OF 'SIGNIFICATNT ACCOUNTING POUCIES & NOTES ON ACCOUNT S' THAT THE SUBSIDY HAS BEEN ACCOUNTED FOR IN THE BOOK S FOR THE PURPOSE OF PAYMENT OF EXCISE DUTY ON ELECTRICITY OF RS. 67.73 LAKHS AND SALES TAX INCENTIVES OF RS. 2494.67 LAKHS . (III) AS PER THE ACCOUNTING STANDARD 12, PARAGRAPH 5.1, IF THE GRANT/SUBSIDY IS OF CAPITAL NATURE THE SAME IS TO B E TREATED AS A PART OF SHAREHOLDERS FUND AND IF IT IS OF INCOME NA TURE, THE SAME IS TO BE TAKEN AS INCOME OVER ONE OR MORE PERI OD. HERE TREATMENT OF THE SUBSIDY RECEIVED AS INCOME BY THE ASSESSEE ITSELF DEBARS IT FROM CLAIMING THE SAME AS A CAPITA L RECEIPT IN THE COMPUTATION OF INCOME . 15. WHEN THE REMAND REPORT SUBMITTED BY THE ASSESSI NG OFFICER WAS CONFRONTED BY THE LD. CIT(APPEALS) TO THE ASSESSEE, A REJOINDER WAS FILED BY THE ASSESSEE AND AFTER TAKING INTO CONSIDERATION THE ENTIRE MATERIAL AVAILABLE ON RECORD AS WELL AS THE SUBMISSIONS MADE BY THE ASSESSEE AS WELL AS THE ASSESSING OFFICER, THE LD. CIT(APPEALS) ALLOWED THE CLAIM OF THE ASSESSEE THAT THE INCENTIVE RECEIVED IN THE FOR M OF SALES TAX SUBSIDY WAS A CAPITAL RECEIPT NOT CHARGEABLE TO TAX FOR THE FOLLOWING REASONS GIVEN IN PARAGRAPH NO. 5 OF HIS IMPUGNED ORDER:- 5. ALL THE FACTS AND SUBMISSION OF THE APPELLANT AS WELL AS FINDINGS OF THE LD. AO IN THE REMAND REPORT HAVE BE EN CAREFULLY ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 13 CONSIDERED. THE APPELLANT OBTAINED INCENTIVE IN THE FORM OF SALES TAX ASSISTANCE OF RS.24,94,66,520/- IN A.Y. 2011-12 AS INDUSTRIAL PROMOTIONAL ASSISTANCE (IPA) UNDER 'THE WEST BENGAL INCENTIVE SCHEME (WBIS) 2004'. THE ABOVE INCENTIVE WAS SET OF F AGAINST SALES TAX LIABILITY PAYABLE TO GOVERNMENT. ON PERUS AL OF THE SCHEME IT IS SEEN THAT THE OBJECT OF THE SCHEME WAS TO PRO MOTE THE NEW INDUSTRIES IN THE BACKWARD AREAS IN THE STATE OF WE ST BENGAL. THE IMPUGNED INCENTIVE WAS NOT CONNECTED WITH THE OPERA TIONS OF THE BUSINESS AND IT WAS SOLELY PROVIDED FOR SETTING UP OF NEW INDUSTRIAL PROJECT OR UNDERTAKING FOR MAJOR EXPANSION IN THE E XISTING INDUSTRIAL UNDERTAKING. THE INCENTIVE WAS GRANTED B Y THE GOVERNMENT OF THE WEST BENGAL IN THE FORM OF DEFERM ENT / REMISSION OF SALES TAX. THE INCENTIVE WAS LINKED WI TH THE CAPITAL INVESTMENT AND SUBJECT TO THE MAXIMUM CEILING OF IN CENTIVE. THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF RA SOJ LIMITED (SUPRA) HAS HELD THAT THE SALES TAX INCENTIVE GRANT ED BY THE WEST BENGAL GOVERNMENT TO THE ASSESSEE WITH THE OBJECT T O A PROVIDE INCENTIVE TO SET UP NEW INDUSTRIAL UNDERTAKING OR S UBSTANTIAL EXPANSION OF THE EXISTING UNDERTAKINGS WAS CAPITAL RECEIPT AND NOT REVENUE IN NATURE. THE HIGH COURT APPLYING THE RATI ONALE OF SUPREME COURT IN PONNY SUGARS (SUPRA) OBSERVED THAT IF THE OBJECT OF THE SUBSIDY IS TO ENABLE THE ASSESSEE TO RUN THE BUSINESS MORE PROFITABLY, THE RECEIPT IS REVENUE RECEIPT. ON THE OTHER HAND, IF THE OBJECT OF THE ASSISTANCE IS TO ENABLE THE ASSESSEE TO SET UP A NEW UNIT OR TO EXPAND AN EXISTING UNIT, THE RECEIPT WOU LD BE A CAPITAL RECEIPT. THEREFORE, THE OBJECT FOR WHICH SUBSIDY IS GIVEN DETERMINES THE NATURE OF THE SUBSIDY AND NOT THE FORM OF THE M ECHANISM THROUGH WHICH THE SUBSIDY IS GIVEN. IN THE INSTANT CASE, THE LD. AO'S CONTENTION THAT SINCE THE SUBSIDY IN THE FORM OF SA LES TAX REMISSION HAS BEEN GRANTED, THE SAME IS REVENUE IN NATURE IS MISPLACED. THE MAIN ELIGIBILITY CONDITION AS PER THE SCHEME WAS TO SET UP A NEW UNIT OR CARRY OUT SUBSTANTIAL EXPANSION OF AN EXIST ING UNIT IN A BACKWARD AREA. THUS, I FIND MERIT IN THE SUBMISSION OF THE APPELLANT THAT SALES TAX INCENTIVE ENJOYED BY THE A PPELLANT FOR SETTING UP INDUSTRY IN THE BACKWARD REGION OF THE S TATE OF WEST BENGAL, CONSTITUTES CAPITAL RECEIPTS IN THE HAND OF THE APPELLANT AS IT HAS BEEN GRANTED FOR CARRYING OUT CAPITAL INVEST MENTS IN BACKWARD AREAS OF THE STATE AND HENCE NOT TAXABLE U NDER NORMAL PROVISION OF THE ACT. 16. THE LD. CIT(APPEALS) ALSO HELD THAT THE AMOUNT OF SALES TAX SUBSIDY WAS LIABLE TO BE EXCLUDED WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF THE ACT FOR THE FOLLOWING REASONS GIVEN IN PARA NO. 6 OF HIS IMPUGNED ORDER:- 6. FURTHER, SINCE THE SUBSIDY IN QUESTION IS NOT IN THE NATURE OF INCOME, THE SAME, IN MY CONSIDERED VIEW C ANNOT BE REGARDED AS INCOME EVEN FOR THE PURPOSE OF BOOK PRO FITS U/S.115JB OF THE ACT THOUGH CREDITED IN THE PROFIT AND LOSS ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 14 ACCOUNT AND HAVE TO BE EXCLUDED FOR ARRIVING AT THE BOOK PROFITS U/S.115JB OF THE ACT. THE DECISION OF HON'B LE APEX COURT IN CASE OF PADMARAJE R. KADAMBANDE (SUPRA) AL SO SUPPORTS THE VIEW THAT CAPITAL RECEIPTS ARE NOT INC OME WITHIN THE DEFINITION OF SEC 2(24) OF THE ACT AND ARE NOT AT ALL CHARGEABLE UNDER THE INCOME TAX ACT, 1961. THUS, IN VIEW OF THE ABOVE DISCUSSION, AND BY PLACING RELIANCE ON TH E DECISION OF ACIT -VS.- SHREE CEMENT LTD (SUPRA). JURISDICTIO NAL HON'BLE TRIBUNAL IN CASE OF KRISHJ RASAYAN EXPORTS (SUPRA). SICPA INDIA PRIVATE LIMITED (SUPRA), IN MY CONSIDERED VIE W OF THE MATTER THE SALES TAX SUBSIDY NOT HAVING ANY CHARACT ER OF INCOME CANNOT BE REGARDED AS INCOME EVEN FOR THE PU RPOSE OF BOOK PROFITS U/S.115JB OF THE ACT THOUGH CREDITED I N THE PROFIT AND LOSS ACCOUNT, AND THE SAME HAVE TO BE EX CLUDED FOR ARRIVING AT THE BOOK PROFITS U/S.115LB OF THE ACT. THE APPELLANT IS ACCORDINGLY ELIGIBLE FOR RELIEF IN THE MATTER, AND THIS GROUND OF APPEAL STANDS ALLOWED. 17. THE LD. D.R. SUBMITTED THAT THE AMOUNT IN DISPU TE RECEIVED ON ACCOUNT OF SALES TAX INCENTIVE WAS OFFERED BY THE A SSESSEE-COMPANY ITSELF AS ITS INCOME IN THE RETURN OF INCOME FILED FOR THE YEAR UNDER CONSIDERATION AND EVEN DURING THE COURSE OF ASSESSM ENT PROCEEDINGS BEFORE THE ASSESSING OFFICER, NO CLAIM WAS MADE BY THE ASSESSEE THAT THE SAID AMOUNT BEING CAPITAL RECEIPT WAS NOT CHARGEABL E TO TAX. HE SUBMITTED THAT THIS NEW CLAIM WAS MADE BY THE ASSESSEE FOR TH E FIRST TIME DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT( APPEALS) AND INSPITE OF STRONG OBJECTION TAKEN BY THE ASSESSING OFFICER IN THE REMAND REPORT FOR ADMITTING THE SAID NEW CLAIM, THE LD. CIT(APPEALS) ENTERTAINED THE SAID NEW CLAIM AND ALLOWED THE SAME ON MERIT. HE CONTEND ED THAT THE LD. CIT(APPEALS) AS A FIRST APPELLATE AUTHORITY CANNOT ENTERTAIN SUCH NEW CLAIM MADE BY THE ASSESSEE FOR THE FIRST TIME BEFOR E HIM, ESPECIALLY WHEN THE SAME WAS NOT MADE BY THE ASSESSEE BEFORE THE AS SESSING OFFICER. 18. ON MERIT, THE LD. D.R. INVITED OUR ATTENTION TO THE RELEVANT SCHEME OF THE STATE GOVERNMENT PUBLISHED IN THE OFFICIAL G AZETTE AND POINTED OUT THAT VARIOUS INCENTIVES WERE OFFERED UNDER THE SAID SCHEME. HE SUBMITTED THE SAID INCENTIVES WERE PROVIDED NOT ONLY FOR SETT ING UP OF NEW INDUSTRIES BUT ALSO TO THE EXISTING INDUSTRIES. HE ALSO POINTED OUT THAT THE ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 15 INCENTIVES UNDER THE SCHEME WERE TO BE PAID AFTER T HE COMMENCEMENT OF THE COMMERCIAL PRODUCTION AND THE OBJECT THUS WAS T O PROMOTE THE PRODUCTION. HE CONTENDED THAT THE INCENTIVE IN THE FORM OF SALES TAX SUBSIDY WAS LINKED TO PAYMENT OF SALES TAX, WHICH C LEARLY SHOWS THAT THE INCENTIVES WERE MEANT FOR AN OPERATIONAL UNIT. RELY ING ON THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS.-CHHINDWARA FUELS [114 TAXMAN 707], HE CONTENDED THAT ANY GOVERNMENT SUBSIDY RECEIVED AFTER THE COMMENCEMENT OF PRODUCTION IS A REVENUE R ECEIPT. HE ALSO RELIED ON THE DECISION OF THE HONBLE DELHI HIGH CO URT IN THE CASE OF CIT VS.- BHUSHAN STEEL PVT. LIMITED [398 ITR 216] TO CO NTEND THAT SIMILAR SUBSIDY RECEIVED BY THE ASSESSEE UNDER U.P. STATE S UBSIDY SCHEME TO ACHIEVE LARGER GOAL OF INDUSTRIALISATION WAS HELD T O BE REVENUE IN NATURE CHARGEABLE TO TAX ON THE GROUND THAT THE ASSESSEE H AD FLEXIBILITY OF USING AMOUNT OF SUBSIDY FOR ANY PURPOSE, NOT NECESSARILY CAPITAL. HE ALSO RELIED ON THE DECISION OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS.- KERACOL CHLORIDES LIMITED [33 TAXMANN.COM 628], WHE REIN IT WAS HELD THAT WHERE SUBSIDY WAS GRANTED FOR PRODUCTION AND N OT FOR SETTING UP OF INDUSTRY, THE SAME SHOULD BE TREATED AS A REVENUE R ECEIPT. HE ALSO RELIED ON THE DECISION OF THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF K.M. SUGAR MILLS LIMITED VS.- CIT [47 TAXMANN.COM 367], WHEREIN IT WAS HELD THAT THE SUBSIDY GIVEN TO COMPENSATE THE ASSESSEE I N RUNNING HIS BUSINESS WAS REVENUE IN NATURE. HE CONTENDED THAT EVEN THE D ECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SAHNEY STEEL W ORKS LIMITED (SUPRA) RELIED UPON BY THE ASSESSEE IN SUPPORT OF ITS CASE BEFORE THE LD. CIT(APPEALS) IS ACTUALLY IN FAVOUR OF THE ASSESSEE, WHEREIN IT WAS HELD THAT PRODUCTION INCENTIVE IN THE FORM OF REFUND OF SALES TAX BEING AVAILABLE TO THE ASSESSEE ONLY AFTER THE COMMENCEME NT OF PRODUCTION, THE SAME WAS A REVENUE RECEIPT. 19. AS REGARDS THE TREATMENT TO BE GIVEN TO THE INC ENTIVE RECEIVED BY THE ASSESSEE IN THE FORM OF SALES TAX SUBSIDY FOR C OMPUTING BOOK PROFIT UNDER SECTION 115JB, THE LD. D.R. CONTENDED THAT TH E AMOUNT OF SUBSIDY ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 16 WAS CREDITED BY THE ASSESSEE-COMPANY ITSELF TO THE PROFIT & LOSS ACCOUNT. RELYING ON THE DECISION OF THE HONBLE SUPREME COUR T IN THE CASE OF APOLLO TYRES LIMITED VS.- CIT (255 ITR 273), HE CO NTENDED THAT NOBODY CAN TINKER WITH THE PROFIT & LOSS ACCOUNT AND THE O NLY ADJUSTMENTS PERMISSIBLE TO THE PROFIT REFLECTED IN THE PROFIT & LOSS ACCOUNT OF THE ASSESSEE ARE TO THE EXTENT AS PROVIDED IN EXPLANATI ON TO SECTION 115JB. HE CONTENDED THAT THE LD. CIT(APPEALS), THEREFORE, WAS NOT JUSTIFIED IN ALLOWING THE CLAIM OF THE ASSESSEE FOR DEDUCTION ON ACCOUNT OF SALES TAX SUBSIDY WHILE COMPUTING THE BOOK PROFIT UNDER SECTI ON 115JB AS THE SAME WAS BEYOND THE SCOPE OF THE ADJUSTMENTS SPECIFIED I N EXPLANATION TO SECTION 115JB. 20. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, CONTENDED THAT THE NEW CLAIM MADE BY THE ASSESSEE FOR EXEMPTION ON ACCOUNT OF SALES TAX SUBSIDY BEING CAPITAL RECEIPT AS MADE BY THE ASSESS EE FOR THE FIRST TIME BEFORE THE LD. CIT(APPEALS) WAS RIGHTLY ADMITTED BY THE LD. CIT(APPEALS) BY RELYING ON THE VARIOUS JUDICIAL PRONOUNCEMENTS C ITED ON BEHALF OF THE ASSESSEE IN SUPPORT AND REFERRED TO AND DISCUSSED B Y HIM IN THE IMPUGNED ORDER. BESIDES THE SAID JUDICIAL PRONOUNCEMENTS, TH E LD. COUNSEL FOR THE ASSESSEE ALSO RELIED ON THE DECISION OF THIS BENCH RENDERED IN THE CASE OF DCIT VS.- INDIAN OIL PVT. LIMITED RENDERED VIDE IT S ORDER DATED 31.01.2018 PASSED IN ITA NO. 1468/KOL/2015, WHEREIN THE DECISION OF THE CIT(APPEALS) IN ADMITTING THE SIMILAR CLAIM MAD E BY THE ASSESSEE FOR EXCLUSION OF SALES TAX SUBSIDY FOR THE FIRST TIME W AS UPHELD BY THE TRIBUNAL. 21. IN SUPPORT OF THE ASSESSEES CASE ON MERIT OF T HE ISSUE, THE LD. COUNSEL FOR THE ASSESSEE RELIED ON THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS.- RASOI LIMITED ( SUPRA) AND CONTENDED THAT THE SUBSIDY RECEIVED BY THE ASSESSEE FROM GOVE RNMENT OF WEST BENGAL UNDER A SIMILAR SCHEME OF INDUSTRIAL PROMOTI ON FOR EXPANSION OF CAPACITIES, MODERNISATION AND IMPROVING THE MARKETI NG CAPABILITIES WAS ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 17 HELD TO BE A CAPITAL RECEIPT. HE CONTENDED THAT AS HELD BY THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF RASOI LIMITED (S UPRA), IT IS THE OBJECT FOR WHICH THE SUBSIDY/ASSISTANCE IS GIVEN THAT DETE RMINES THE NATURE OF THE INCENTIVE SUBSIDY AND THE FORM ON THE MECHANISM THROUGH WHICH THE SUBSIDY WAS GIVEN IS IRRELEVANT. HE CONTENDED THAT SINCE THE OBJECT OF THE SUBSIDY IN THE SAID CASE WAS FOR EXPANSION OF THE C APACITIES, MODERNISATION AND IMPROVING THE MARKETING CAPABILIT IES, IT WAS HELD BY THE HONBLE CALCUTTA HIGH COURT THAT IT WAS A CAPIT AL RECEIPT AND MERELY BECAUSE THE AMOUNT OF SUBSIDY WAS EQUIVALENT TO 90% OF THE SALES TAX PAID BY THE BENEFICIARY DID NOT IMPLY WITH THE SAME WAS IN THE FORM OF REFUND OF SALES TAX PAID. 22. THE LD. COUNSEL FOR THE ASSESSEE INVITED OUR AT TENTION TO THE WEST BENGAL INCENTIVE SCHEME, 2004 AS PUBLISHED IN THE O FFICIAL GAZETTE TO POINT OUT THAT THE OBJECT OF THE SAID SCHEME WAS TO EXTEND INCENTIVE FOR PROMOTION OF THE INDUSTRY IN THE STATE. HE ALSO POI NTED OUT THAT THE SAID SCHEME WAS APPLICABLE TO ALL LARGE/SMALL SCALE PROJ ECTS AND TOURISM UNITS IN LARGE/SMALL SECTOR TO BE SET UP AND ALSO EXPANSI ON PROJECT OF EXISTING UNITS ON OR AFTER 1 ST APRIL, 2004. HE CONTENDED THAT EVEN THE EARLIER INCENTIVE SCHEME OF 2000 OF THE WEST BENGAL GOVERNM ENT WAS HAVING THE SAME OBJECT OF PROMOTING INDUSTRIES AND THE INCENTI VE RECEIVED UNDER THE SAID SCHEME IN THE FORM OF SALES TAX SUBSIDY WAS HE LD TO BE CAPITAL RECEIPT NOT CHARGEABLE TO TAX IN THE VARIOUS CASES DECIDED BY THE TRIBUNAL. HE CITED ONE OF SUCH DECISIONS RENDERED BY THE TRIBUNA L IN THE CASE OF DCIT VS.- SHYAM STEEL INDUSTRIES LIMITED VIDE ORDER DATE D 03.02.2017 PASSED IN ITA NO. 602/KOL/2014. 23. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE SALES TAX INCENTIVE RECEIVED BY THE ASSESSEE UNDER THE 2004 S CHEME HAS BEEN FINALLY LINKED TO CAPITAL COST OF PROJECT AND THUS THE SAID INCENTIVE IS LIMITED TO CAPITAL INVESTMENT MADE BY THE ASSESSEE IN THE EXPANSION OF ITS EXISTING UNIT IN THE BACKWARD AREAS. HE RELIED ON T HE DECISION OF THE DELHI BENCH OF THIS TRIBUNAL IN THE CASE OF PEPSICO INDIA HOLDINGS PVT. LIMITED ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 18 VS.- ADDITIONAL CIT (ITA NOS. 1334/CHANDIGARH/2010 & OTHERS DATED 19.11.2018) AND SUBMITTED THAT SIMILAR SUBSIDY RECE IVED UNDER WEST BENGAL INCENTIVE SCHEME OF 2004 WAS HELD TO BE CAPI TAL IN NATURE BY THE TRIBUNAL AFTER TAKING INTO CONSIDERATION THE OBJECT IVE OF THE SAID SCHEME AS WELL AS THE DECISIONS OF THE HONBLE SUPREME COU RT IN THE CASE OF CIT VS.- PONNY SUGAR & CHEMICALS LIMITED [306 ITR 392] AND CIT VS.- CHAPHALKER BROTHERS [88 TAXMANN.COM 178]. 24. AS REGARDS THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SAHANY STEEL & PRESS WORKS LIMITED (SUPRA) CITED BY THE LD. D.R., THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE SAID DE CISION SUPPORTS THE ASSESSEES CASE ON THE ISSUE UNDER CONSIDERATION AS RIGHTLY HELD BY THE LD. CIT(APPEALS) AND NOT THE REVENUES CASE AS SOUGHT T O BE CONTENDED BY THE LD. D.R. HE INVITED OUR ATTENTION TO PARAGRAPH NO. 19 OF THE ORDER OF THE HONBLE SUPREME COURT, WHEREIN IT WAS OBSERVED BY T HE HONBLE APEX COURT THAT IF THE SCHEME WAS THAT THE ASSESSEE WILL BE GIVEN REFUND OF SALES TAX ON PURCHASE OF MACHINERY AS WELL ON RAW M ATERIALS TO ENABLE THE ASSESSEE TO ACQUIRE NEW PLANTS AND TO ENCOURAGE EXP ANSION OF ITS MANUFACTURING CAPACITY IN A BACKWARD AREA, THE ENTI RE SUBSIDY MUST BE HELD TO BE A CAPITAL RECEIPT IN THE HANDS OF THE AS SESSEE AND IT WILL NOT BE OPEN TO THE REVENUE TO CONTEND THAT THE REFUND OF S ALES TAX PAID ON RAW MATERIALS OR FINISHED PRODUCTS MUST BE TREATED AS R EVENUE RECEIPT IN THE HANDS OF THE ASSESSEE. HE ALSO RELIED ON THE DECISI ON OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS.- CHAPHALKAR B ROTHERS [400 ITR 279] AND SUBMITTED THAT THE PURPOSE TEST APPLIED IN THE CASE OF SAHANY STEELS & PRESS WORKS LIMITED HAS BEEN REITERATED BY THE HON BLE SUPREME COURT WHILE DETERMINING THE NATURE OF INCENTIVE/ASSISTANC E. AS REGARDS THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CAS E OF BHUSAN STEELS & STRIPS LIMITED (SUPRA) RELIED UPON BY THE LD. D.R. IN SUPPORT OF THE REVENUES CASE, HE SUBMITTED THAT THE OPERATION OF THE SAID DECISION HAS ALREADY BEEN STAYED BY THE HONBLE SUPREME COURT AS PER THE INTERIM ORDER PASSED ON 20.11.2017 IN SLP NO. 30728 TO 3073 2/ 2017. ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 19 25. AS REGARDS THE TREATMENT TO BE GIVEN TO THE SUB SIDY IN QUESTION WHILE COMPUTING THE BOOK PROFIT OF THE ASSESSEE-COM PANY UNDER SECTION 115JB OF THE ACT, THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT EVEN THOUGH THE SAID AMOUNT WAS CREDITED BY THE ASSESSEE -COMPANY TO ITS PROFIT & LOSS ACCOUNT, THE SAME BEING CAPITAL IN NA TURE NOT CHARGEABLE TO TAX UNDER THE INCOME TAX ACT, 1961 CANNOT BE INCLUD ED WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF THE ACT. HE HAS CONTENDED THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE VARIOUS DECISIONS OF THE TRIBUNAL AND THE LD. CIT(APPEALS) IS FULLY JUSTIFIED IN DECIDING THIS ISSUE IN FAVOUR OF THE ASSESSEE BY FO LLOWING THE VARIOUS DECISIONS OF THE TRIBUNAL. HE CONTENDED THAT VARIOU S BENCHES OF THE TRIBUNAL INCLUDING THE KOLKATA BENCHES HAVE TAKEN A CONSISTENT VIEW IN FAVOUR OF THE ASSESSEE ON THIS ISSUE AND CITED SOME MORE DECISIONS OF THE TRIBUNAL, WHICH HAVE BEEN RENDERED RECENTLY AFTER P ASSING OF THE IMPUGNED ORDER BY THE LD. CIT(APPEALS). 26. IN THE REJOINDER, THE LD. D.R. SUBMITTED THAT T HE AMOUNT OF SUBSIDY IN DISPUTE WAS CREDITED BY THE ASSESSEE-COMPANY TO ITS PROFIT & LOSS ACCOUNT AND IT IS, THEREFORE, NOT PERMISSIBLE TO RE DUCE THE SAME WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF TH E ACT AS THE SAME IS BEYOND THE SCOPE OF ADJUSTMENTS PERMISSIBLE AS PER EXPLANATION TO SECTION 115JB. HE CONTENDED THAT IT IS NOT CLEAR AS TO WHETHER IN THE CASES CITED ON BEHALF OF THE ASSESSES, THE AMOUNT WAS CRE DITED BY THE ASSESSEES TO THEIR PROFIT & LOSS ACCOUNT. HE CONTENDED THAT N O DOUBT THE NOTES ON ACCOUNTS AND ACCOUNTING POLICIES ARE REQUIRED TO BE TAKEN INTO CONSIDERATION WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB, BUT NO SUCH NOTE ON ACCOUNTS ON THE ISSUE OF SALES TAX SUBSIDY WAS GIVEN BY THE ASSESSEE-COMPANY IN THE PRESENT CASE. HE ALSO C ONTENDED THAT THE OBJECT OF 2004 SCHEME IS NOT VERY CLEAR AND IN SUCH A CASE, THE SUBSIDY IS TO BE TREATED AS REVENUE RECEIPT AS HELD BY THE HON BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS.- ABHISHEK INDUST RIES LIMITED [156 ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 20 TAXMAN 257]. HE CONTENDED THAT THERE IS A CHANGE IN THE INCENTIVE SCHEME OF 2004 AS COMPARED TO THE INCENTIVE SCHEME OF 2000 AND, THEREFORE, THE CASES CITED BY THE LD. COUNSEL FOR THE ASSESSEE INV OLVING 2000 SCHEME CANNOT BE RELIED UPON TO DECIDE THE ISSUE INVOLVED IN THE PRESENT CASE WHERE THE INCENTIVE/SUBSIDY IS RECEIVED UNDER 2004 SCHEME. HE CONTENDED THAT THE 2004 SCHEME IS APPLICABLE EVEN T O THE EXISTING UNITS AND NOT ONLY FOR SETTING UP OF NEW UNITS AND THIS I S THE VITAL ASPECT, WHICH IS REQUIRED TO BE TAKEN INTO CONSIDERATION FOR DETE RMINING AND DECIDING THE NATURE OF SUBSIDY RECEIVED UNDER 2004 SCHEME. 27. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND AL SO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AS REGARDS T HE PRELIMINARY OBJECTION RAISED ON BEHALF OF THE REVENUE CHALLENGI NG THE ACTION OF THE LD. CIT(APPEALS) IN ENTERTAINING THE NEW CLAIM MADE BY THE ASSESSEE FOR TREATING THE SUBSIDY IN QUESTION RECEIVED DURING TH E YEAR UNDER CONSIDERATION AS CAPITAL RECEIPT NOT CHARGEABLE TO TAX, IT IS OBSERVED THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASS ESSEE, BESIDES THE VARIOUS JUDICIAL PRONOUNCEMENTS CITED ON BEHALF OF THE ASSESSEE AND RELIED UPON BY THE LD. CIT(APPEALS) IN HIS IMPUGNED ORDER, BY THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL I N THE CASE OF DCIT VS.- INDIAN OIL PETRONAS PVT. LIMITED RENDERED VIDE ITS ORDER DATED 31.05.2018 IN ITA NO. 157/KOL/2017, WHEREIN IT WAS HELD BY THE TRIBUNAL BY RELYING ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LIMITED VS.- CIT (229 ITR 383) A S WELL AS THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF MAYNAK PODDAR (HUF) VS.- WTO (262 ITR 633) THAT HIS JURISDICTION WAS RIGHTLY EXERCISED BY THE LD. CIT(APPEALS) IN ENTERTAINING THE ADDITIO NAL GROUND RAISED BY THE ASSESSEE CLAIMING EXCLUSION OF CAPITAL SUBSIDY RECEIVED BY WAY OF SALES TAX REMISSION UNDER THE WEST BENGAL INCENTIVE SCHEME. WE, THEREFORE, FIND THE OBJECTION RAISED ON BEHALF OF T HE REVENUE IN THIS REGARD TO BE UNSUSTAINABLE AND OVERRULING THE SAME, WE NOW PROCEED TO DECIDE THE ISSUE ON MERIT. ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 21 28. DURING THE YEAR UNDER CONSIDERATION, THE ASSESS EE HAD RECEIVED INCENTIVE OF RS.24,94,66,520/- UNDER THE WEST BENGA L INCENTIVE SCHEME, 2004 IN THE FORM OF REFUND OF SALES TAX PAID AND T HE QUESTION THAT HAS ARISEN IS REGARDING THE TAXABILITY OF THE SAID AMOU NT UNDER THE INCOME TAX ACT, 1961, WHICH DEPENDS ON THE DETERMINATION O F THE CHARACTER OF THE AMOUNT, WHETHER IT IS CAPITAL RECEIPT OR REVENU E RECEIPT. THERE ARE VARIOUS JUDICIAL PRONOUNCEMENTS WHEREIN GUIDELINES OR CRITERIA HAVE BEEN LAID DOWN TO DETERMINE THE CHARACTER OF SUCH AMOUNT S RECEIVED AS INCENTIVES/SUBSIDIES. AS OBSERVED BY THE HONBLE SU PREME COURT IN THE CASE OF K.C.P. LIMITED VS.- CIT [245 ITR 431], IT IS NOT THE NAME GIVEN BY THE ASSESESE OR EVEN BY THE REVENUE OR ANYONE ELSE THAT MATTERS, BUT IT IS TRUE CHARACTER OF THE RECEIPT THAT DETERMINES ITS T AXABILITY AND BEING REGARDED AS FALLING WITHIN THE CAPITAL FIELD OR OUT OF IT. AS HELD BY THE HONBLE SUPREME COURT IN THE CASE OF PONNY SUGAR & CHEMICALS LIMITED (SUPRA), THE NATURE OF THE RECEIPT OF THE INCENTIVE HAS TO BE EXAMINED IN THE LIGHT OF THE OBJECT FOR WHICH SUCH INCENTIVE WA S PAID AND IF THE TRUE CHARACTER OF THE INCENTIVE IS TO ENABLE THE ASSESSE E TO MEET THE CAPITAL COST, THEN THAT TRUE CHARACTER MUST BE GIVEN FULL R ECOGNITION AND THE FACT THAT THE RECEIPT WAS SUBSEQUENT TO THE COMMENCEMENT OF PRODUCTION IS NOT TO BE ALLOWED TO STAND IN THE WAY IN ITS PROPER TREATMENT AS A RECEIPT IN THE CAPITAL FIELD MEANT TO MEET A CAPITAL COST. HONBLE SUPREME COURT HELD THAT IT, THEREFORE, CANNOT BE SAID THAT THE IN CENTIVE GIVEN BEING POST PRODUCTION, THOUGH MEANT EXCLUSIVELY FOR MEETING TH E CAPITAL COST, THE AMOUNT OF INCENTIVE WOULD BE A TRADING RECEIPT IN T HE HANDS OF THE RECIPIENT. 29. IN THE CASE OF SAHANY STEEL & PRESS WORKS LIMIT ED (SUPRA), WHICH HAS BEEN RELIED UPON BY THE LD. REPRESENTATIVES OF BOTH THE SIDES IN SUPPORT OF THEIR RESPECTIVE STAND ON THE ISSUE UNDE R CONSIDERATION, PAYMENTS HAD BEEN MADE POST PRODUCTION AND SINCE IT WAS IN NO WAY LINKED TO THE STEPS THAT HAD BEEN TAKEN BY THE ASSE SSEE IN SETTING UP THE ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 22 INDUSTRY, HONBLE SUPREME COURT HELD THAT THE INCEN TIVE RECEIVED WAS REVENUE IN NATURE CHARGEABLE TO TAX. IT WAS, HOWEVE R, CLARIFIED BY THE HONBLE SUPREME COURT THAT THE SUBSIDY IN THAT CASE HAD NOT BEEN GRANTED FOR BRINGING INTO EXISTENCE ANY NEW ASSET. IT WAS F URTHER CLARIFIED BY THE HONBLE SUPREME COURT THAT THE CHARACTER OF THE SUB SIDY IN THE HANDS OF THE RECIPIENT, WHETHER REVENUE OR CAPITAL, WILL HAV E TO BE DETERMINED BY HAVING REGARD TO THE PURPOSE FOR WHICH THE SUBSIDY IS GIVEN. EXPLAINING FURTHER WITH ILLUSTRATION, IT WAS OBSERVED BY THE H ONBLE SUPREME COURT THAT IF THE SCHEME WAS THAT THE ASSESSEE WILL BE GI VEN REFUND OF SALES TAX ON PURCHASE OF MACHINERY AS WELL AS ON RAW MATERIAL S TO ENABLE THE ASSESSEE TO ACQUIRE NEW PLANTS AND MACHINERY FOR FU RTHER EXPANSION OF ITS MANUFACTURING CAPACITIES IN BACKWARD AREAS, THE ENT IRE SUBSIDY MUST BE HELD TO BE A CAPITAL RECEIPT IN THE HANDS OF THE AS SESSEE. AFTER TAKING NOTE OF BOTH THESE DECISIONS OF THE HONBLE SUPREME COUR T IN THE CASE OF SAHANY STEEL & PRESS WORKS LIMITED (SUPRA) AND PONN Y SUGAR & CHEMICALS LIMITED (SUPRA), HONBLE CALCUTTA HIGH COURT HAS HE LD IN THE CASE OF RASOI LIMITED (SUPRA) THAT THE SUBSIDY RECEIVED BY THE AS SESSEE FROM THE GOVERNMENT OF WEST BENGAL UNDER THE SCHEME OF INDUS TRIAL PROMOTION FOR EXPANSION OF CAPACITIES, MODERNISATION AND IMPROVIN G ITS MARKETING CAPABILITIES WAS A CAPITAL RECEIPT NOT CHARGEABLE T O TAX. 30. IN THE CASE OF K.M. SUGAR MILLS LIMITED (SUPRA) CITED BY THE LD. D.R., SUBSIDY WAS GIVEN TO THE ASSESSEE BY THE CENTRAL GO VERNMENT TO COMPENSATE BURDEN ON ACCOUNT OF INTEREST, STORAGE A ND INSURANCE ETC. FOR HOLDING BUFFER STOCK OF SUGAR AND THE OBJECT THUS B EING TO COMPENSATE THE ASSESSEE IN RUNNING HIS BUSINESS, IT WAS HELD BY TH E HONBLE ALLAHABAD HIGH COURT THAT THE SUBSIDY GIVEN WAS CLEARLY REVEN UE IN NATURE. IN THE CASE OF KERACOL CHLORIDES LIMITED (SUPRA) CITED BY THE LD. D.R., SUBSIDY WAS GRANTED FOR PRODUCTION AND NOT FOR SETTING UP A N INDUSTRY AND THE SAME, THEREFORE, WAS TREATED AS REVENUE RECEIPT. IN THE CASE OF CHHINDWARA FUELS (SUPRA) CITED BY THE LD. D.R., THE RE WAS NO REPRESENTATION MADE ON BEHALF OF THE ASSESSEE AND I N THE VERY BRIEF ORDER ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 23 PASSED EX-PARTE, SUBSIDY RECEIVED BY THE ASSESSEE F ROM THE GOVERNMENT IN THE FORM OF SALES TAX REFUND WAS HELD TO BE A REVEN UE RECEIPT BY THE HONBLE CALCUTTA HIGH COURT MAINLY ON THE GROUND TH AT THE SAME WAS RECEIVED BY THE ASSESSEE AFTER PRODUCTION. IN SUPPO RT OF THIS CONCLUSION, RELIANCE WAS PLACED BY THE HONBLE CALCUTTA HIGH CO URT ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SAHANY STE EL & PRESS WORKS LIMITED (SUPRA). AS ALREADY NOTED BY US, HONBLE SU PREME COURT IN THE SUBSEQUENT DECISION RENDERED IN THE CASE OF PONNY S UGAR & CHEMICALS LIMITED (SUPRA) HAS HELD, AFTER TAKING NOTE OF THEI R EARLIER DECISION RENDERED IN THE CASE OF SAHANY STEEL & PRESS WORKS LIMITED (SUPRA), THAT IF THE TRUE CHARACTER OF THE INCENTIVE IS TO ENABLE THE ASSESSEE TO MEET THE CAPITAL COST, THEN THAT TRUE CHARACTER MUST BE GIVE N FULL RECOGNITION AND THE FACT THAT THE RECEIPT WAS SUBSEQUENT TO THE COM MENCEMENT OF PRODUCTION IS NOT TO BE ALLOWED TO STAND IN THE WAY OF ITS PROPER TREATMENT AS A RECEIPT IN THE CAPITAL FIELD MEANT T O MEET A CAPITAL COST. AS REGARDS THE DECISION OF THE HONBLE DELHI HIGH COUR T IN THE CASE OF BHUSAN STEELS & STRIPS LIMITED (SUPRA) RELIED UPON BY THE LD. D.R., IT IS OBSERVED THAT THE OPERATION OF THE JUDGMENT PASSED BY THE HO NBLE DELHI HIGH COURT IN THE SAID CASE HAS BEEN STAYED BY THE HONB LE SUPREME COURT BY THE INTERIM ORDER PASSED IN SLP NO. 30728 TO 30732/ 2017. 31. THE POSITION THAT CLEARLY EMERGES FROM THE VARI OUS JUDICIAL PRONOUNCEMENTS CITED BY THE LD. REPRESENTATIVES OF BOTH THE SIDES, AS DISCUSSED ABOVE, IS THAT THE CHARACTER OF SUBSIDY I N THE HANDS OF THE RECIPIENT, WHETHER CAPITAL OR REVENUE, IS REQUIRED TO BE DETERMINED AFTER HAVING REGARD TO THE PURPOSE FOR WHICH THE SUBSIDY WAS GIVEN AND THE MODE AND SOURCE OF PAYMENT AS WELL AS THE POINT OF TIME WHEN THE SUBSIDY WAS PAID IS NOT RELEVANT. KEEPING THIS POSI TION IN MIND, LET US NOW SEE THE PURPOSE FOR WHICH THE SUBSIDY IN QUESTI ON WAS GIVEN TO THE ASSESSEE IN THE FORM OF SALES TAX REFUND UNDER THE WEST BENGAL INCENTIVE SCHEME, 2004. AS PER THE WEST BENGAL INCENTIVE SCHE ME, 2004 NOTIFIED IN THE OFFICIAL GAZETTE, IT WAS MEANT TO EXTEND INCENT IVE FOR PROMOTION OF ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 24 INDUSTRIES IN THE STATE OF WEST BENGAL AND THE SAME WAS APPLICABLE TO ALL LARGE/SMALL SCALE PROJECTS AND TOURISM UNITS IN LAR GE/SMALL SCALE SECTOR TO BE SET UP AND ALSO EXPANSION PROJECT OF EXISTING UNITS ON OR AFTER 1 ST APRIL, 2004. THE OBJECT OF THE SAID SCHEME THUS WAS TO PROMOTE SETTING UP AND EXPANSION OF INDUSTRIES AND THE SUBSIDY WAS MAD E AVAILABLE TO THE EXISTING INDUSTRIES FOR UNDERTAKING SUBSTANTIAL EXP ANSION. UNDER THE SAID SCHEME, MEGA PROJECTS WERE NOT ELIGIBLE FOR THE I NTEREST SUBSIDY AND IN LIEU THEREOF IPA WAS MADE AVAILABLE TO THEM @ 75% O F THE SALES TAX, WHICH INCENTIVE WAS NOT TO EXCEED 100% OF THE FIXED CAPITAL INVESTMENT. THE SUBSIDY THUS WAS LINKED TO THE FIXED CAPITAL IN VESTMENT MADE BY THE INDUSTRY AND IT WAS IN THE FORM OF REFUND OF SALES TAX PAID. IN LINE WITH THIS SCHEME, THE ASSESSEE-COMPANY MADE EXPANSION OF ITS EXISTING HALDIA MANUFACTURING UNIT SITUATED IN MIDNAPORE DISTRICT I N THE STATE OF WEST BENGAL INVOLVING HUGE CAPITAL OUTLAY OF RS.168 CROR ES AND WAS ENTITLED TO IPA OF 75% OF SALES TAX PAID FOR A PERIOD OF 15 YEA RS SUBJECT TO A MAXIMUM AMOUNT TO THE EXTENT OF 100% OF THE FIXED C APITAL INVESTMENT I.E. RS.168 CRORES. DURING THE YEAR UNDER CONSIDERA TION, THE ASSESSEE- COMPANY WAS ELIGIBLE FOR THE SAID INCENTIVE TO THE EXTENT OF RS.24,94,66,520/- AND THE BENEFIT TO THAT EXTENT WA S AVAILED BY IT. 32. AT THE TIME OF HEARING BEFORE US, THE LD. D.R. HAS SUBMITTED THAT THE OBJECT OF THE WEST BENGAL INCENTIVE SCHEME, 2004 WA S ALTOGETHER DIFFERENT FROM THE OBJECT OF THE WEST BENGAL INCENT IVE SCHEME OF 2000. HE HAS CONTENDED THAT THE VARIOUS DECISIONS RENDERED B Y THE TRIBUNAL AND CITED BY THE LD. COUNSEL FOR THE ASSESSEE TREATING THE SUBSIDY UNDER THE 2000 SCHEME AS CAPITAL RECEIPT THUS ARE NOT APPLICA BLE. HE HAS ALSO CONTENDED THAT THE OBJECT OF THE 2004 SCHEME NOT BE ING VERY CLEAR, THE INCENTIVE/SUBSIDY RECEIVED UNDER THE SAID SCHEME SH OULD BE TREATED AS REVENUE IN NATURE. WE ARE UNABLE TO ACCEPT THESE CO NTENTIONS OF THE LD. D.R. AS ALREADY NOTICED FROM THE RELEVANT SCHEME, T HE OBJECT OF THE SCHEME WAS VERY CLEAR TO PROMOTE SETTING UP AND EXP ANSION OF INDUSTRIES AND IT CANNOT BE SAID THAT THE SAID OBJECT WAS NOT CLEAR AS SOUGHT TO BE ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 25 CONTENDED BY THE LD. D.R. EVEN THE OBJECT OF THE SC HEME OF 2004 CANNOT BE SAID TO BE ENTIRELY DIFFERENT FROM THE SCHEME OF 20 00, INASMUCH AS, THE INTENTION OF THE 2000 SCHEME WAS ALSO TO EXTEND INC ENTIVE FOR PROMOTION OF INDUSTRIES IN THE STATE OF WEST BENGAL AND THE S UBSIDY WAS MEANT FOR EXPANSION OF THE CAPACITIES OF THE ELIGIBLE INDUSTR Y, THEIR MODERNISATION AND IMPROVING THE MARKETING CAPABILITIES, WHICH CAN NOT BE SAID TO BE MATERIALLY DIFFERENT FROM THE SCHEME OF 2004. ON TH E OTHER HAND, THERE IS SIMILARITY IN THE OBJECTS OF BOTH THESE SCHEMES, IN ASMUCH AS, IT WAS TO PROVIDE INCENTIVE FOR THE PURPOSE OF SETTING UP OF NEW UNITS AS WELL AS FOR THE EXPANSION OF THE EXISTING UNITS. 33 . IT IS PERTINENT TO NOTE THAT THE SIMILAR ISSUE HAD COME UP FOR CONSIDERATION BEFORE THE DELHI BENCH OF THIS TRIBUN AL IN THE CASE OF PEPSICO INDIA HOLDINGS PVT. LIMITED (SUPRA) CITED B Y THE LD. COUNSEL FOR THE ASSESSEE. IN THE SAID CASE, INDUSTRIAL PROMOTIO NAL ASSISTANCE IN THE FORM OF SUBSIDY BY WAY OF REFUND OF SALES TAX PAID WAS RECEIVED BY THE ASSESSEE UNDER THE SAME SCHEME, I.E. WEST BENGAL IN CENTIVE SCHEME, 2004 AND THE ISSUE RAISED WAS RELATING TO THE TAXABILITY OF THE SUBSIDY RECEIVED BY THE ASSESSEE. WHILE DECIDING THE SAID ISSUE, THE TRIBUNAL TOOK NOTE OF THE OBJECT OF THE WEST BENGAL INCENTIVE SCHEME, 200 4, WHICH WAS FOUND TO BE TO PROMOTE SETTING UP AND EXPANSION OF PROJECTS/ INDUSTRY AND KEEPING IN VIEW THE SAID OBJECT AND THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF CIT VS.- PONNY SUGAR & CHEMIC ALS LIMITED (SUPRA) AS WELL AS IN THE CASE OF CIT VS.- CHAPHALKER BROTHER S (SUPRA), IT WAS HELD BY THE TRIBUNAL THAT THE SUBSIDY RECEIVED BY THE AS SESSEE UNDER THE WEST BENGAL INCENTIVE SCHEME OF 2004 WAS CAPITAL IN NATU RE AND THE SAME COULD NOT BE TAXED AS REVENUE RECEIPT. 34. HAVING REGARD TO ALL THE RELEVANT FACTS OF THE CASE AND KEEPING IN VIEW THE LEGAL POSITION EMANATING FROM THE VARIOUS JUDICIAL PRONOUNCEMENTS DISCUSSED ABOVE, WE ARE OF THE VIEW THAT THE SUBSIDY IN QUESTION RECEIVED BY THE ASSESSEE IN THE FORM OF RE FUND OF SALES TAX UNDER ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 26 THE WEST BENGAL INCENTIVE SCHEME, 2004 WAS CAPITAL IN NATURE AS THE PURPOSE OF THE SAME WAS FOR THE EXPANSION OF THE EX ISTING INDUSTRY OF THE ASSESSEE. WE ALSO HOLD THAT MERELY BECAUSE THE SAID SUBSIDY WAS TO BE RECEIVED BY THE ASSESSEE ONLY AFTER THE COMMENCEMEN T OF PRODUCTION WOULD NOT CHANGE ITS CHARACTER, WHICH OTHERWISE WAS CAPITAL IN NATURE. WE ACCORDINGLY UPHOLD THE IMPUGNED ORDER OF THE LD. CIT(APPEALS) GIVING RELIEF TO THE ASSESSEE ON THIS ISSUE. 35. AS REGARDS THE ISSUE RELATING TO THE TREATMENT TO BE GIVEN TO THE SALES TAX SUBSIDY WHILE COMPUTING THE BOOK PROFIT U NDER SECTION 115JB OF THE ACT, IT IS OBSERVED THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE VARIOUS DEC ISIONS OF THE TRIBUNAL. IN ONE OF SUCH DECISIONS RENDERED IN THE CASE OF BE NANI INDUSTRIES LIMITED (SUPRA), THE COORDINATE BENCH OF THIS TRIBUNAL HAS HELD THAT THE CAPITAL RECEIPT IN THE FORM OF SALES TAX INCENTIVE IS REQUI RED TO BE EXCLUDED WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF TH E ACT. IN ANOTHER DECISION RENDERED IN THE CASE OF BRICKSALE INDIA LI MITED (SUPRA), IT WAS HELD BY THE MUMBAI BENCH OF THIS TRIBUNAL THAT THE AMOUNTS WHICH ARE NOT TAXABLE IN THE NORMAL COMPUTATION CANNOT BE INC LUDED WHILE COMPUTING THE BOOK PROFIT BECAUSE SUCH AMOUNTS DO N OT REALLY REFLECT A RECEIPT IN THE NATURE OF INCOME AND CANNOT FORM PAR T OF THE BOOK PROFIT. 36. AT THE TIME OF HEARING BEFORE US, THE ONLY CONT ENTION RAISED BY THE LD. D.R. IS THAT IT IS NOT VERY CLEAR AS TO WHETHER IN THE CASES DECIDED BY THE TRIBUNAL AND RELIED UPON BY THE LD. COUNSEL FOR THE ASSESSEE, THE AMOUNT IN DISPUTE WAS CREDITED TO THE PROFIT & LOSS ACCOUNT OF THE ASSESSEE AS IN THE PRESENT CASE. HOWEVER, AS POINTE D OUT BY THE LD. COUNSEL FOR THE ASSESSEE FROM THE RELEVANT PORTION OF THE ORDERS OF THE TRIBUNAL, THE AMOUNTS IN DISPUTE WERE CREDITED BY T HE ASSESSEES IN THE PROFIT & LOSS ACCOUNT AND THE FACTUAL POSITION IN T HE SAID CASES THUS WAS SIMILAR TO THAT OF THE ASSESSEE. AS FURTHER POINTED OUT BY THE LD. COUNSEL FOR THE ASSESSEE, A NOTE NO. 20 WAS GIVEN BY THE AS SESSEE-COMPANY AS ITA NO. 1915/KOL/2017 A.Y. 2011 -2012 M/S. EMAMI BIOTECH LIMITED 27 NOTES TO ACCOUNTS FORMING PART OF ITS ANNUAL ACCOUN TS POINTING OUT SPECIFICALLY THAT IT WAS ENTITLED FOR SALES TAX INC ENTIVE OF RS.2494.67 LAKHS UNDER THE WEST BENGAL INCENTIVE SCHEME, 2004. WE, T HEREFORE, FIND NO INFIRMITY IN THE IMPUGNED ORDER OF THE LD. CIT(APPE ALS) ALLOWING THE CLAIM OF THE ASSESSEE FOR EXCLUSION OF THE AMOUNT OF SUBS IDY IN QUESTION WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF TH E ACT. GROUNDS NO. 2 TO 5 OF THE REVENUES APPEAL ARE ACCORDINGLY DISMIS SED. 37. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON MARCH 29, 201 9. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER VICE -PRESIDENT (KZ) KOLKATA, THE 29 TH DAY OF MARCH, 2019 COPIES TO : (1) DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-11(1), KOLKATA, P-7, CHOWRINGHEE SQUARE, AAYAKAR BHAWAN, KOLKATA-700 069 (2) M/S. EMAMI BIOTECH LIMITED, 687, ANANDAPUR, E.M. BYPASS ROAD, KOLKATA-700 107 (3) COMMISSIONER OF INCOME TAX (APPEALS)-22, KOLKAT A (4) COMMISSIONER OF INCOME TAX- , KOLKAT A (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.