The Income-tax Officer, Jammu V. M/s. SPM Industries, Jammu

ITA 378/ASR/2011

• Counselvise Citation: 37820914 RSA 2011
• Duration Of Justice: 9 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-04-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 12-04-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 22-06-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: R L CHANNALIA
• Keywords: Capital receipt
• Section: 143(3); 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. 378(ASR)/2011 ASSESSMENT YEAR:2005-06 PAN: AAZFS-4846-D THE INCOME TAX OFFICER, M/S. SPM INDUSTRIES, WARD 1 (3) VS. PHASE II, INDUSTRIAL AREA, JAMMU JAMMU (APPELLANT) (RESPONDENT) APPELLANT BY: R.L. CHANNALIA, D.R. RESPONDENT BY: WRITTEN SUBMISSION. DATE OF HEARING :12/04/2012 DATE OF PRONOUNCEMENT: 12/04/2012 ORDER PER BENCH: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE IMPUGNED ORDER OF THE CIT(A) DATED 04.04.2011 RELATING TO A SSESSMENT YEAR 2005-06 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: ITA NO.378(ASR)/2011 ASSESSMENT YEAR : 2005-06 2 A. REGARDING DELETION OF PENALTY U/S 271 (1) (C) F OR FURNISHING INACCURATE PARTICULARS OF INCOME ARISING ON ACCOUNT OF EXCISE DUTY REFUND. 1. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. CIT(A) WAS RIGHT IN ALLOWING RELIEF ON ACCOUNT OF DEDUCTION U/ S 80IB ON CENTRAL EXCISE DUTY REFUND BY RELYING UPON ORDERS OF HONBL E 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 TACKLING TH E UNEMPLOYMENT IN THE SATE WHICH CANNOT BE SAID TO BE 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 JUDGEMENTS OF HONBLE SUPREME COURT OF INDIA IN THE CASE OF PONNI SUGAR & SAWHNEY STEEL AND PRESS WORKS LTD., WHEREIN THE HONBLE 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 JUDGEM ENTS OF THE HONBLE SUPREME COURT. IN THE CASE OF ASSESSEE, THE MONEY RECEIVED BY THE ASSESSE ON ACCOUNT OF REFUND OF CENTRAL EXCI SE WAS NOT SUPPOSED TO BE SPENT IN A PARTICULAR MANNER FOR PUR POSE OF SUBSTANTIAL EXPANSION OF THE INDUSTRY. B. THE APPELLANT CRAVES TO AMEND OR ADD ANY ONE OR MORE GROUNDS OF APPEAL. ITA NO.378(ASR)/2011 ASSESSMENT YEAR : 2005-06 3 3. NOTICE OF HEARING WAS ISSUED TO THE ASSESSEE BY REGISTERED A.D. POST IN RESPONSE TO THE SAME ASSESSEE FILED THE FOLLOWIN G WRITTEN SUBMISSION:- RE: APPEAL NO. ITA NO. 378/ASR/2011 FOR ASSESSME NT YEAR 2005-06 THE ASSESSMENT WAS COMPLETED U/S 143(3) AND ASSESSM ENT ORDER PASSED ON 27.12.2007 AT A TAXABLE INCOME OF RS. 4,7 4,69,060/- AFTER DISALLOWING DISALLOWING DEDUCTION OF RS. 4,74,68,85 9/- CLAIMED BY THE APPELLANT U/S 80 IB OF INCOME TAX ACT, BY TREATING THE EXCISE DUTY EXEMPTION/REFUND AMOUNTING TO RS. 4,82,94,091/- REC EIVED UNDER CENTRAL EXCISE NOTIFICATION 56/2002 DT. 14.11.2002, AS ITS INCOME NOT DIRECTLY DERIVED FROM THE INDUSTRIAL UNDERTAKING AN D PENALTY IS LEVIED U/S 271(1) (C)FOR FURNISHING INACCURATE PARTICULARS OF INCOME. THE HONBLE HIGH COURT OF JAMMU & KASHMIR HAS GRANT ED THE RELIEF AGAINST ADDITIONS MADE IN THE ASSESSMENT ORDER. THE COPY OF SUCH ORDER IS ENCLOSED. IN VIEW OF ABOVE, THE DEPARTMENT AL APPEAL BEFORE THE HONBLE AMRITSAR TRIBUNAL AGAINST THE ORDER OF LD. CIT(APPEALS) QUASHING THE PENALTY ORDER IS FRIVOLOUS & WITHOUT A NY MERITS AND MAY KINDLY BE REJECTED. SD/- YOGESH GUPTA PARTNER 4. LD. D.R. RELIED UPON THE ORDER PASSED BY THE ASS ESSING OFFICER. 5. AFTER HEARING THE LD. D.R. AS WELL AS GOING THRO UGH THE WRITTEN SUBMISSION FILED BY THE ASSESSEE AND THE IMPUGNED O RDER. WE ARE OF THE CONSIDERED OPINION THAT THE LD. FIRST APPELLATE AUT HORITY HAS RIGHTLY DELETED THE PENALTY IN DISPUTE ON THE BASIS OF ORDER PASSED BY THE HONBLE JURISDICTIONAL HIGH COURT MENTIONED IN THE WRITTEN SUBMISSION OF THE ASSESSEE, ALLOWING THE BENEFIT U/S 80IB OF THE ACT, TO THE ASSESSEE. THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY HELD THAT SIN CE THE QUANTUM ADDITION DID NOT SURVIVE, THE PENALTY HAS NO BASIS LEFT TO BE LE VIED AND HENCE DELETED. WE UPHOLD THE IMPUGNED ORDER OF THE FIRST APPELLATE AU THORITY BY DISMISSING THE APPEAL FILED BY THE REVENUE. ITA NO.378(ASR)/2011 ASSESSMENT YEAR : 2005-06 4 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH APRIL, 2012. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:12 TH APRIL, 2012 /LALIT/ COPY OF THE ORDER IS FORWARDED TO : 1. THE ASSESSEE: M/S. SPM INDUSTRIES, JAMMU 2. THE ITO, WARD 1 (3) JAMMU 3. THE CIT(A), JAMMU 4. THE CIT, JAMMU 5. THE SR DR, ITAT, ASR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH : AMRITSAR.