The Income-tax Officer, Jammu V. M/s. Alpha Menthol, Jammu

ITA 300/ASR/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 85916 (ITAT-AMRITSAR)
• Duration Of Justice: 10 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 11-03-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 05-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R L GUPTA
• 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. B.P. JAIN, ACCOUNTANT MEMBER I.T.A. NO. 300(ASR)/2014 ASSESSMENT YEAR: 2009-10 PAN: AALFA8284H THE INCOME TAX OFFICER, WARD 1(1), JAMMU VS. M/S ALPHA MENTHOL PLOT NO.38, PHASE-1, SICOP INDL. COMPLEX, GANGYAL, JAMMU (APPELLANT) (RESPONDENT) APPELLANT BY: SH. TARSEM LAL, DR RESPONDENT BY: SH. R.L. GUPTA, ADV. DATE OF HEARING: 11.03.2015 DATE OF PRONOUNCEMENT: 11.03.2015 ORDER PER A.D.JAIN, JM: THIS IS DEPARTMENTS APPEAL FOR THE ASSESSMENT YEAR 2009-10 AGAINST THE ORDER DATED 17.02.2014, PASSED BY THE LEARNED CIT(A ), JAMMU, DELETING THE ADDITION/DISALLOWANCE OF RS.1,73,84,024/- MADE BY THE AO U/S 80IB OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT), ON CENTR AL EXCISE DUTY REFUND, TREATING IT TO BE A REVENUE RECEIPT NOT DIRECTLY AT TRIBUTABLE TO THE INDUSTRIAL ACTIVITIES OF THE ASSESSEE-FIRM. 2. THE ASSESSING OFFICER MADE THE DISALLOWANCE IN O RDER TO FOLLOW THE CONSISTENCY OF THE STAND AS TAKEN BY THE DEPARTMENT IN OTHER CASES. THE ASSESSING I.T.A. NO. 300(ASR)/2014 ASSESSMENT Y EAR: 2009-10 2 OFFICER OBSERVED THAT THE DECISION IN THE CASE OF M/S SHREE BALAJI ALLOYS AND ORS. VS. CIT , 333 ITR 335 (J&K), WHICH HAS GONE IN FAV OUR OF THE ASSESSEE, HAD NOT BEEN ACCEPTED BY THE DEPARTMENT AND THE DEPARTMENT S SPECIAL LEAVE PETITION WAS HITHERTO PENDING BEFORE THE HONBLE SUPREME COURT. 3. THE LEARNED CIT(A) DELETED THE DISALLOWANCE, FOL LOWING THE JUDGMENT OF THE HONBLE J & K HIGH COURT, IN THE CA SE OF M/S. SHREE BALAJI ALLOYS AND OTHERS VS. CIT (SUPRA), WHERE I T HAS BEEN HELD THAT EXCISE DUTY REFUND IN PURSUANCE TO THE INCENTIVE A LLOWANCE BY THE GOVERNMENT PERTAINING TO INDUSTRIAL POLICY INTRODUC ED IN THE STATE OF J & K IS A CAPITAL RECEIPT. 4. CHALLENGING THE IMPUGNED ORDER, THE LEARNED DR H AS CONTENDED THAT THE LEARNED CIT(A) HAS ERRED IN DELETING THE A DDITION CORRECTLY MADE BY THE ASSESSING OFFICER BY DISALLOWING THE DE DUCTION UNDER SECTION 80IB OF THE ACT, ON EXCISE DUTY REFUND, TRE ATING IT TO BE A REVENUE RECEIPT NOT DIRECTLY ATTRIBUTABLE TO THE IN DUSTRIAL ACTIVITIES OF THE ASSESSEE; THAT WHILE DOING SO, THE LEARNED CIT( A) HAS ERRED IN FOLLOWING THE JUDGMENT OF HONBLE J & K HIGH COURT IN THE CASE OF M/S. SHREE BALAJI ALLOYS AND OTHERS VS. CIT (SUPR A), WHICH DECISION HAS NOT BEEN ACCEPTED BY THE DEPARTMENT AND THE APP EAL FILED AGAINST THIS DECISION BEFORE THE HONBLE SUPREME COURT IS S TILL PENDING; AND I.T.A. NO. 300(ASR)/2014 ASSESSMENT Y EAR: 2009-10 3 THAT THE LEARNED CIT(A) HAS ERRED IN NOT APPRECIATI NG THE JUDGMENTS OF THE HONBLE SUPREME COURT IN SAHNEY STEEL AND PRES S WORKS LTD. VS. CIT , 228 ITR 253 (SC) AND CIT VS. PONNY SUGARS A ND CHEMICALS LTD. , 306 ITR 392 (SC); WHEREIN, THE HONBLE SUPR EME COURT HAS HELD SUCH RECEIPTS TO BE REVENUE RECEIPTS. 5. THE LEARNED COUNSEL FOR THE ASSESSEE HAS RELIED ON THE IMPUGNED ORDER. 6. HAVING HEARD THE LD. DR AND IN THE LIGHT OF THE MATERIAL PLACED ON RECORD, WE ARE OF THE VIEW THAT THE ISSUE AT HA ND IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F THE HONBLE JURISDICTIONAL HIGH COURT OF JAMMU AND KASHMIR IN T HE CASE OF M/S SHREE BALAJI ALLOYS (SUPRA). M/S SHREE BALAJI ALL OYS (SUPRA), HOLDS, INTER ALIA, THAT EXCISE DUTY REFUND IS A CAPITAL RE CEIPT. THIS JUDGMENT, IT IS SEEN, HAS BEEN PASSED AFTER DULY TAKING INTO CON SIDERATION THE CASES OF SAHNEY STEEL AND PRESS WORKS LTD.(SUPRA) AND PONNY SUGARS AND CHEMICALS LTD.(SUPRA). THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE FOLLOWING THE CASE OF MEPCO INDUSTRIES LT D. VS. CIT, 319 ITR 208 (SC), WHEREIN, BOTH SAHNEY STEEL AND PRESS WORKS LTD.(SUPRA) AND PONNY SUGARS AND CHEMICALS LTD. (SUPRA) WERE CONSIDERED. I.T.A. NO. 300(ASR)/2014 ASSESSMENT Y EAR: 2009-10 4 7. AS SUCH, THE DEPARTMENT IS WRONG IN CONTENDING T HAT THE LEARNED CIT(A) HAS ERRED IN DECIDING THE ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING THE DECISION OF THE HONBLE J & K HIGH CO URT IN THE CASE OF M/S. SHREE BALAJI ALLOYS AND OTHERS VS. CIT (SUP RA), AND THAT THE LEARNED CIT(A) HAS ERRED IN NOT APPRECIATING THE CA SES OF SAHNEY STEEL AND PRESS WORKS LTD.(SUPRA) AND PONNY SUGAR S AND CHEMICALS LTD. (SUPRA). 8. WE HAVE ALSO TAKEN THE ABOVE VIEW, IN SIMILAR FA CTS AND CIRCUMSTANCES, IN INCOME TAX OFFICER, WARD-3, PATH ANKOT VS. M/S. T.K. PAPER MILLS, CHACK SAKTA, KATHUA, H.O.- PATHAN KOT, IN ITA NO.106(ASR)/2014, FOR A.Y. 2010-11, VIDE ORDER DATE D 05.08.2014. 9. FOR THE ABOVE DISCUSSION, THE GROUNDS TAKEN BY T HE DEPARTMENT ARE FOUND TO BE SHORN OF MERIT, AND ARE, HENCE, REJ ECTED. 10. THEREFORE, FINDING NO ERROR, WHATSOEVER THEREIN , THE LEARNED CIT(A)S ORDER UNDER APPEAL IS UPHELD. 11. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH MARCH, 2015. SD/- SD/- (B.P. JAIN) (A.D. JAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 11.03.2015 /PK/ I.T.A. NO. 300(ASR)/2014 ASSESSMENT Y EAR: 2009-10 5 COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: M/S ALPHA MENTAL, PLOT NO.38, PHASE-1 , SICOP INDL. COMPLEX, GANGYAL, JAMM U 2. INCOME TAX OFFICER, WARD-1(1), JAMMU 3. THE CIT(A) 4. THE CIT 5. THE SR DR, I.T.A.T., ASR TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.