The Income-tax Officer, Kathua V. Shri Rajinder Ghai, Kathua

ITA 231/ASR/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 63418 (ITAT-AMRITSAR)
• Duration Of Justice: 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 28-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect; Capital receipt
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO. 231(ASR)/2012 ASSESSMENT YEAR:2008-09 PAN :ADDPG4186D INCOME TAX OFFICER, VS. SH. RAJINDER GHAI, WARD 1(4), KATHUA. PROP. M/S. BHAGWATI PIPES, V & PO BASHOLI, DISTT. KATHUA. (APPELLANT) (RESPONDENT) APPELLANT BY:SH. TARSEM LAL, DR RESPONDENT BY: NONE DATE OF HEARING:31/07/2012 DATE OF PRONOUNCEMENT:06/08/2012 ORDER PER BENCH ; THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST THE IMPUGNED ORDER OF THE CIT(A), JAMMU, DATED 20.03.2012 FOR THE ASSE SSMENT YEAR 2008-09 ON THE FOLLOWING GROUNDS: 1 ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. CIT(A) WAS RIGHT IN ALLOWING RELIEF ON ACCOUNT OF DEDUCTIO N U/S 80IB ON CENTRAL EXCISE DUTY REFUND BY RELYING UPON ORDERS O F HON'BLE HIGH COURT IF J&K, JAMMU WHICH HAS BEEN DELIVERED NOT O N MERITS OF THE ISSUE BUT HOLDING THE RECEIPT TO BE A CAPITAL RECEI PT ONLY BECAUSE THE POLICY UNDER WHICH THE SAME WAS PAID ENVISAGED TACK LING THE ITA NO.231(ASR)2012 2 UNEMPLOYMENT IN THE STATE WHICH CANNOT BE SAID TO B E A GOOD TEST FOR DECIDING WHETHER A RECEIPT IS A TRADING RECEIPT OR A CAPITAL RECEIPT. 2. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN FACTS AND CIRCUMSTANCES AND IN LAW IN NOT APPRECIATING THE JUDGMENTS OF HON'BLE SUPREME COURT OF INDIA IN THE CASE OF PONNI SUGAR & SAWHNEY STEEL AND PRESS WORKS LTD, WHEREIN THE HON'BLE SUPREME COURT HAD HELD SUCH RECEIPTS TO BE THE REVE NUE RECEIPTS IN AS MUCH AS IN THAT CASE PAYMENTS WERE MADE ONLY AFTER THE INDUSTRIES HAD BEEN SET UP AND PAYMENTS WERE NOT MADE FOR PURPOSE OF SETTING UP OF INDUSTRIES. 3. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN FACTS AND CIRCUMSTANCES AND IN LAW IN NOT CONSIDERING THE DECISION IN THE CASE OF SEAHAM HARBOUR DOCK COMPANY WHICH LAYS DOWN TWO IMPORTANT TESTS FOR DETERMINING WHETHER RE CEIPTS IS A TRADING RECEIPT OR A CAPITAL RECEIPT. 4. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN FACTS AND CIRCUMSTANCES AND IN LAW IN NOT APPRECIATING AND APPLIED THE PURPOSE TEST AS LAID DOWN BY THE JUDGME NTS OF THE HON'BLE SUPREME COURT. IN THE CASE OF ASSESSEE, THE MONEY RECEIVED BY THE ASSESSEE ON ACCOUNT OF REFUND OF CENTRAL EXCISE WAS NOT SUPPOSED TO BE SPENT IN A PARTICULAR MANNER FOR PURPOSE OF SUBS TANTIAL EXPANSION OF THE INDUSTRY. 5. EVEN THOUGH THE TAX EFFECT INVOLVED IN THIS CASE IS BELOW RS.3 LACS, THE APPEAL IS FILED IN VIEW OF THE DECISION O F THE HONBLE SUPREME COURT IN THE CASE OF CIT CENTRAL III VS. SU RYA HERBAL LTD. VIDE CC NO.13694/2011 DATED 29.08.2011 IN WHICH THE HONBLE SUPREME COURT HAD HELD THAT THE CIRCULAR DATED 09.0 2.2011 SHOULD NOT BE APPLIED IPSO FACTO, PARTICULARLY, WHEN THE MATTE R HAS A CASCADING EFFECT. THERE ARE CASES UNDER THE INCOME-TAX ACT, 1 961 IN WHICH COMMON PRINCIPLE MAY BE INVOLVED IN SUBSEQUENT GROU P OF MATTERS OR LARGE NUMBER OF MATTERS. 6. THE APPELLANT CRAVES TO AMEND OR ADD ANY ONE OR MORE GROUNDS OF APPEAL. ITA NO.231(ASR)2012 3 2. AFTER HEARING THE LD. DR AND PERUSING THE RELEVA NT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDERS PASSED BY THE REVEN UE AUTHORITIES, WE ARE OF THE VIEW THAT THE LD. FIRST APPELLATE AUTHORITY HAS DECIDED THE ISSUE IN DISPUTE IN FAVOUR OF THE ASSESSEE BY RESPECTFULLY FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT OF J & K IN THE CASE OF S HREE BALAJI ALLOYS V. CIT AND ANOTHER (2011) 333 ITR 335 (J&K) WHERE THE HON BLE HIGH COURT HELD THAT THE EXCISE DUTY REFUND IS TO BE TREATED AS CA PITAL RECEIPT AND NOT LIABLE TO BE TAXED. THE ISSUE INVOLVED IN THE PRESENT AP PEAL IS SIMILAR, WHICH THE HONBLE HIGH COURT HAS DECIDED IN FAVOUR OF THE ASS ESSEE, IN THE AFORESAID CASE. NO OTHER POINT HAS BEEN ESTABLISHED AND ARGU ED BY THE LD. DR FOR DISTINGUISHING THE DECISION OF THE HONBLE JURISDIC TIONAL HIGH COURT, IN THE CASE OF SHREE BALAJI ALLOYS V. CIT AND ANOTHER (SU PRA). THEREFORE, KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND THE ISSUE IN DISPUTE AS WELL AS THE ORDER PASSED BY THE JURISDIC TIONAL HIGH COURT IN THE CASE OF SHREE BALAJI ALLOYS V. CIT AND ANOTHER (SU PRA), WE ARE OF THE VIEW THAT THE LD. FIRST APPELLATE AUTHORITY HAS PASSED A WELL REASONED ORDER BY FOLLOWING THE AFORESAID DECISION OF THE JURISDICTIO NAL HIGH COURT. ACCORDINGLY, WE DISMISS THE APPEAL FILED BY THE REV ENUE BY UPHOLDING IMPUGNED ORDER. 3. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ITA NO.231(ASR)2012 4 ORDER PRONOUNCED IN THE OPEN COURT ON 6TH AUGUST, 2012. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 6 TH AUGUST, 2012 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:SH. RAJINDER GHAI, KATHUA. 2. THE ITO, KATHUA. 3. THE CIT(A), JAMMU. 4. THE CIT, JAMMU. 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.