The Income-tax Oficer, Jammu V. Sh. Rajesh Giri Prop.M/s. Avita Mobiles Industries, Jammu

ITA 383/ASR/2012

• Counselvise Citation: 38320914 RSA 2012
• Duration Of Justice: 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 03-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: JOGINDER SINGHCA
• Keywords: Tax effect; Capital receipt

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. 383(ASR)/2012 ASSESSMENT YEAR:2009-10 PAN :ADIPG0617N INCOME TAX OFFICER, VS. SH. RAJESH GIRI PROP. WARD 1(2), JAMMU.. M/S. M/S. AVITA MOBILE INDUSTRI ES, JAMMU. (APPELLANT) (RESPONDENT) APPELLANT BY:SH. TARSEM LAL, DR RESPONDENT BY: SH. JOGINDER SINGH,CA DATE OF HEARING:21/11/2012 DATE OF PRONOUNCEMENT:21/11/2012 ORDER PER BENCH ; THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST THE IMPUGNED ORDER OF THE CIT(A), JAMMU, DATED 27.07.2012 FOR THE ASSE SSMENT YEAR 2009-10 ON THE FOLLOWING GROUNDS: 1 ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. CIT(A) WAS RIGHT IN ALLOWING RELIEF ON ACCOUNT OF CENTRAL EXCISE DUTY REFUND BY RELYING UPON ORDERS OF HON'BLE HIGH COURT IF J& K, JAMMU WHICH ITA NO.383(ASR)/2012 2 HAS BEEN DELIVERED NOT ON MERITS OF THE ISSUE BUT H OLDING THE RECEIPT TO BE A CAPITAL RECEIPT ONLY BECAUSE THE POLICY UNDER WHICH THE SAME WAS PAID ENVISAGED TACKLING THE UNEMPLOYMENT IN THE STA TE WHICH CANNOT BE SAID TO BE A GOOD TEST FOR DECIDING WHETHER A RE CEIPT 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. ITA NO.383(ASR)/2012 3 6. THE APPELLANT CRAVES TO AMEND OR ADD ANY ONE OR MORE GROUNDS OF APPEAL. 2. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDERS PASSED BY THE REVENUE AUTHORITIES, WE ARE OF THE VIEW THAT THE LD. FIRST APPELLATE AUT HORITY HAS DECIDED THE ISSUE IN DISPUTE IN FAVOUR OF THE ASSESSEE BY RESPECTFULL Y FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT OF J & K IN THE CASE OF SHREE BALAJI ALLOYS V. CIT AND ANOTHER (2011) 333 ITR 335 (J&K) WHEREIN T HE HONBLE HIGH COURT HAS HELD THAT THE EXCISE DUTY REFUND IS TO BE TREATED AS CAPITAL RECEIPT AND NOT LIABLE TO BE TAXED. THE ISSUE INVOLVED IN THE PRESENT APPEAL IS SIMILAR, WHICH THE HONBLE HIGH COURT HAS DECIDED I N FAVOUR OF THE ASSESSEE, IN THE AFORESAID CASE. NO OTHER POINT HAS BEEN EST ABLISHED AND ARGUED BY THE LD. DR FOR DISTINGUISHING THE DECISION OF THE HONB LE JURISDICTIONAL HIGH COURT, IN THE CASE OF SHREE BALAJI ALLOYS V. CIT A ND ANOTHER (SUPRA). THEREFORE, KEEPING IN VIEW THE FACTS AND CIRCUMSTAN CES OF THE PRESENT CASE AND THE ISSUE IN DISPUTE AS WELL AS THE ORDER PASSE D BY THE JURISDICTIONAL HIGH COURT IN THE CASE OF SHREE BALAJI ALLOYS V. CIT A ND ANOTHER (SUPRA), WE ARE OF THE VIEW THAT THE LD. FIRST APPELLATE AUTHORITY HAS PASSED A WELL REASONED ORDER BY FOLLOWING THE AFORESAID DECISION OF THE J URISDICTIONAL HIGH COURT, ITA NO.383(ASR)/2012 4 WHICH REQUIRES NO INTERFERENCE. ACCORDINGLY, WE DIS MISS THE APPEAL FILED BY THE REVENUE BY UPHOLDING IMPUGNED ORDER OF THE LD. CIT(A). 3. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21ST N OV; 2012. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 21 ST NOV., 2012 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:SH. RAJESH GIRI PROP. M/S. AVITA MOBIL E INDUSTRIES, JAMMU 2. THE ITO, WARD 1(2), JAMMU. 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.