The Income-tax Officer, Jammu V. M/s. ACR Foods Pvt. Ltd, Jammu

ITA 234/ASR/2012

• Counselvise Citation: 23420914 RSA 2012
• Duration Of Justice: 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 06-08-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 29-05-2012
• 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. 234(ASR)/2012 ASSESSMENT YEAR:2004-05 PAN: AADCA2333I THE INCOME-TAX OFFICER, VS. M/S. ACR FOODS PVT. LT D; WARD-1(1), JAMMU. JAMMU. (APPELLANT) (RESPONDENT) APPELLANT BY:SH. TARSEM LAL, DR RESPONDENT BY: SH. VINAMAR GUPTA, CA DATE OF HEARING :06.08.2012 DATE OF PRONOUNCEMENT:06.08.2012 ORDER PERBENCH; THIS APPEAL FILED BY THE REVENUE IS AGAINST THE IM PUGNED ORDER OF THE CIT(A), JAMMU, DATED 23.03.2012 RELATING TO ASSESS MENT YEAR 2004-05 ON THE FOLLOWING GROUNDS: 1 ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN DELETING PENALTY IMPOSED U/S 271(1)(C) ON ACCOUNT OF DISALLOWANCE OF DEDUCTION U/S 80IB ON CENTRAL EX CISE DUTY REFUND BY RELYING UPON ORDERS OF HON'BLE HIGH COURT OF J&K, JAMMU WHICH HAS BEEN DELIVERED NOT ON MERITS OF THE ISSUE BUT HOLDING THE RECEIPT TO BE A CAPITAL RECEIPT ONLY BE CAUSE THE POLICY UNDER WHICH THE SAME WAS PAID ENVISAGED TACK LING THE UNEMPLOYMENT IN THE STATE WHICH CANNOT BE SAID TO B E A GOOD TEST FOR DECIDING WHETHER A RECEIPT IS A TRADING RE CEIPT 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 2 IN THE CASE OF PONNI SUGAR & SAWHNEY STEEL AND PRES S WORKS LTD, WHEREIN THE HON'BLE SUPREME COURT HAD HE LD SUCH RECEIPTS TO BE THE REVENUE RECEIPTS IN AS MUCH AS I N THAT CASE PAYMENTS WERE MADE ONLY AFTER THE INDUSTRIES HAD BE EN SET UP AND PAYMENTS WERE NOT MADE FOR PURPOSE OF SETTING U P 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 HARB OUR DOCK COMPANY WHICH LAYS DOWN TWO IMPORTANT TESTS FOR DET ERMINING WHETHER RECEIPTS 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 D OWN BY THE JUDGMENTS OF THE HON'BLE SUPREME COURT. IN THE CAS E OF ASSESSEE, THE MONEY RECEIVED BY THE ASSESSEE ON ACC OUNT OF REFUND OF CENTRAL EXCISE WAS NOT SUPPOSED TO BE SPE NT IN A PARTICULAR MANNER FOR PURPOSE OF SUBSTANTIAL EXPANS ION 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 DECI SION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT CENTRAL II I VS. SURYA HERBAL LTD. VIDE CC NO.13694/2011 DATED 29.08.2011 IN WHICH THE HONBLE SUPREME COURT HAD HELD THAT THE CIRCULA R DATED 09.03.2011 SHOULD NOT BE APPLIED IPSO FACTO, PARTIC ULARLY, WHEN THE MATTER HAS A CASCADING EFFECT. THERE ARE CASES UNDER THE INCOME TAX ACT, 1961 IN WHICH COMMON PRINCIPLE MAY BE INVOLVED IN SUBSEQUENT GROUP OF MATTERS OR LARGE NU MBER OF MATTERS. THE APPELLANT CRAVES TO AMEND OR ADD ANY ONE OR MOR E GROUNDS OF APPEAL. 2. THE LD. DR, SH. TARSEM LAL, RELIED UPON THE ORDE R PASSED BY THE ASSESSING OFFICER. 3. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSES SEE, SH. VINAMAR GUPTA,CA RELIED UPON THE ORDER PASSED BY THE LD. CI T(A). 3 4. AFTER HEARING BOTH THE PARTIES AND THOROUGHLY GO ING THROUGH THE MATERIAL AVAILABLE ON RECORDS INCLUDING THE IMPUGNE D ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY, WE ARE OF THE CONSIDERED OPINION THAT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY DELETED THE PENALTY IN DISPUTE ON THE BASIS OF ORDER PASSED BY THE JURISDICTIONAL HIGH COURT OF J & K IN THE CASE OF M/S. SHREE BALAJI ALLOYS AND OTHERS VS. CIT (2011) 333 I TR 335 (J&K) WHERE THE HONBLE HIGH COURT HELD THAT THE EXCISE DUTY REFUND IS TO BE TREATED AS CAPITAL RECEIPT AND NOT LIABLE TO BE TAXED. TH E LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY HELD THAT SINCE THE QUANTUM ADDITION ST ANDS DELETED BY THE JURISDICTIONAL HIGH COURT OF J & K (SUPRA) AS SUCH THERE IS NO AMOUNT ON WHICH PENALTY UNDER SECTION 271(1)(C) IS ATTRACTED AND ACCORDINGLY PENALTY IMPOSED BY THE AO IS DELETED. HENCE, WE UPHOLD THE IMPUGNED ORDER OF THE FIRST APPELLATE AUTHORITY BY DISMISSING THE APPEAL FILED BY THE REVENUE. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED ORDER PRONOUNCED IN THE OPEN COURT ON 6 TH AUGUST, 2012. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 6 TH AUGUST , 2012 /SKR/ COPY OF THE ORDER IS FORWARDED TO : 1. THE ASSESSEE:M/S.ACR FOODS PVT. LTD., JAMMU. 2. THE ITO WARD 1(1), JAMMU. 3. THE CIT(A), JAMMU.4.THE CIT, JAMMU.5.THE SR DR, ITA T, AMRITSR. TRUE COPY BY ORDER 4