The Dy. Commissioner of income Tax, Jammu V. M/s Quality Casting Industries, Jammu

ITA 295/ASR/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9660 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 1 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 19-07-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 09-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P N ARORA
• Keywords: Capital receipt
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. A.D. JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO.295(ASR)/2015 ASSESSMENT YEAR:2010-11 PAN: AAAFQ1123N DY. COMMR. OF INCOME TAX, VS. M/S. QUALITY CASTING INDUSTRIES, CIRCLE-1, LANE NO.1, SIDCO INDUSTRIAL JAMMU. COMPLEX, BARI BRAHMNA, JAMMU (APPELLANT) (RESPONDENT) APPELLANT BY: SH. RAHUL DHAWAN, DR RESPONDENT BY: SH. P.N. ARORA, ADVOCATE DATE OF HEARING: 19/07/2016 DATE OF PRONOUNCEMENT: 01/08/2016 ORDER PER A.D. JAIN, JM: THIS IS THE DEPARTMENTS APPEAL FOR THE ASSESSMENT YEAR 2010-11, AGAINST THE ORDER DATED 26.02.2015, PASSED BY THE LD. CIT(A)-5, LUDHIANA. THE DEPARTMENT HAS RAISED THE FOLLOWING G ROUNDS OF APPEAL: 1. WHETHER THE COMMISSIONER OF INCOME TAX (APPEALS )-5, LUDHIANA WAS RIGHT IN LAW TO ALLOW DEDUCTION U/S 80 IB OF THE INCOME TAX ACT, 1961 ON CENTRAL EXCISE DUTY REFUND AND INTEREST SUBSIDY BY RELYING UPON THE JUDGMENT OF THE HONBLE HIGH COURT OF J & K IN THE CASE OF M/S. SHREE BALAJI ALLOYS & OTH ERS & IGNORING THE RATIO OF THE LAW ON THE ISSUE AS LAID DOWN IN T HE CASE OF PINNI SUGAR & SAWHNEY STEEL AND PRESS WORKS LTD. 2. WHETHER THE COMMISSIONER OF INCOME TAX (APPEALS) -5, LUDHIANA COMMITTED AN ERROR IN LAW IN NOT FOLLOWING THE LAS AS LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF PO NNI SUGAR & SAWHNEY STEEL AND PRESS WORKS LTD, WHEREIN SIMILAR RECEIPTS WERE HELD TO BE REVENUE IN NATURE AS THE SAME HAD BEEN M ADE AFTER THE ITA NO.295(ASR)/2015 A.Y. 2010-11 2 INDUSTRIES HAD BEEN SET UP AND NOT FOR PURPOSE OF S ETTING UP OF THE INDUSTRIES. 3. WHETHER THE COMMISSIONER OF INCOME TAX (APPEALS) -5, LUDHIANA WAS RIGHT IN NOT APPRECIATING AND APPLYING THE PURPOSE TEST AS LAID DOWN BY THE JUDGMENTS OF THE HONBLE S UPREME CURT, IN THE CASE OF ASSESSEE, AS THE MONEY RECEIVED BY T HE ASSESSEE ON ACCOUNT OF CENTRAL EXCISE AND INTEREST SUBSIDY WAS NOT SUPPOSED TO BE SPENT IN A PARTICULAR MANNER OR FOR THE PURPO SE OF SUBSTANTIAL EXPANSION OF THE INDUSTRY. 2. IT WAS NOTICED THAT THERE WAS A DELAY OF 3 DAYS IN FILING THE APPEAL BEFORE THE TRIBUNAL. THE REVENUE HAS FILED AN APPLI CATION DATED 14.12.2015 ALONGWITH AN AFFIDAVIT, FOR CONDONATION OF DELAY, WHICH READS AS UNDER: 1. THERE IS A DELAY OF 3 DAYS IN FILING THE APPEAL IN THE ABOVE MENTIONED CASE WHICH HAS OCCASIONED BECAUSE OF DISTURBANCE IN JAMMU ON 4 TH , 5 TH & 6 TH JUNE, 2015 AND CURFEW IMPOSED IN THE CITY. 2. DELAY CAUSED MAY NOT BE ATTRIBUTED TO THE REVENU E IN AS MUCH AS IN CASE DELAY IS NOT CONDONED., THE REVENUE WILL SUFFER HUGE LOSS. IT IS, THEREFORE, PRAYED THAT THE DELAY IN FILING T HE APPEAL IN THE SAID CASE MAY KINDLY BE CONDONED. THE REQUISITE AFFIDAVI T IS ALSO ATTACHED ALONGWITH APPLICATION. 3. THE LD. COUNSEL FOR THE ASSESSEE DID NOT OPPOSE THE PETITION OF THE REVENUE FOR CONDONATION OF DELAY. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THE EXPLANATION SUBMITTED BY THE REVENUE TH AT THE DELAY OF 3 DAYS IN FILING THE APPEAL BEFORE THE TRIBUNAL DUE TO DISTURBANCE AND CLAMPING OF CURFEW IN JAMMU FROM 4 TH TO 6 TH JUNE, 2015, IS FOUND TO BE ITA NO.295(ASR)/2015 A.Y. 2010-11 3 SUFFICIENT AND THE DELAY WAS BONAFIDE AND WAS NOT A DELIBERATE AND INTENTIONAL DELAY. 4.1. IN VIEW OF THE FACTS ON RECORD AND THE EXPLANA TION SUBMITTED BY THE REVENUE, THE DELAY IN FILING THE APPEAL BEFORE THE TRIBUNAL IS CONDONED AND THE APPEAL OF THE REVENUE IS ADMITTED FOR ADJUD ICATION. 5. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISSUE IN QUESTION HAS ALREADY BEEN DECIDE D BY THE JURISDICTIONAL HIGH COURT OF J & K IN THE CASE OF SHREE BALAJI AL LOYS V. CIT AND ANOTHER, (2011) 333 ITR 335 (J&K) IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE, WHERE THE HONBLE HIGH COURT HELD TH AT EXCISE DUTY REFUND IS TO BE TREATED AS CAPITAL RECEIPT AND NO T LIABLE TO BE TAXED. 6. THE LD. DR, ON THE OTHER HAND, RELIED ON THE IMP UGNED ORDER. 7. WE HAVE HEARD THE BOTH THE PARTIES AND HAVE PERU SED THE MATERIAL AVAILABLE ON RECORD WITH US AND WE ARE OF THE VIE W THAT THE ISSUE INVOLVED IN THE GROUNDS OF THE APPEAL OF THE REVE NUE RELATING TO DEDUCTION UNDER SECTION 80IB ON EXCISE DUTY REFUND IS SQUARELY COVERED BY THE JUDGMENT OF THE HON'BLE JURISDICTIONAL HIGH COURT OF JAMMU & KASHMIR IN THE CASE OF SHREE BALAJI ALLOYS V. CIT AND ANOTHER, (2011) 333 ITR 335 (J&K) IN FAVOUR OF THE ASSESSEE AND AG AINST THE REVENUE, WHERE THE HONBLE HIGH COURT HAS HELD THAT THE EXCI SE DUTY REFUND IS TO BE TREATED AS CAPITAL RECEIPT AND IS NOT LIABLE T O BE TAXED. THEREFORE, ITA NO.295(ASR)/2015 A.Y. 2010-11 4 RESPECTFULLY FOLLOWING THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT OF JAMMU & KASHMIR IN THE CASE OF SHREE BALA JI ALLOYS V. CIT AND ANOTHER (SUPRA), ALL THE GROUNDS OF THE REVENUES APPEAL ARE REJECTED. 8. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 01/08 / 2016. SD/- SD/- (T.S. KAPOOR) (A.D. JAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER /SKR/ DATED: 01/08/2016 COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:M/S. QUALITY CASTING INDUSTRIES, BARI BRAHMANA, JAMMU., 2. THE DCIT, CIR.1, JAMMU 3. THE CIT(A) 4. THE CIT 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.