ACIT, New Delhi V. M/s. First Flexipack Corporation, New Delhi

ITA 4013/DEL/2011

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6956 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 10-01-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 05-09-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: HARI KUMAR SHARMA
• Keywords: Capital receipt
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : E NEW DELHI BEFORE SHRI J.SUDHAKAR REDDY, AM AND SMT.BEENA A PILLAI, JM ITA NO: 5056 /DEL/201 0 AY : 200 6 - 07 ITA NO: 3944 /DEL/201 3 AY : 200 9 - 10 ITA NO: 3945 /DEL/201 3 AY : 20 10 - 11 FIRST FLEXIPACK CORPORATION VS. DCIT, CENTRAL CIRCLE 18 305, 3 R D FLOOR, BHANOT CORNER NEW DELHI PAMPOSH ENCLAVE, GREATER KAILASH I NEW DELHI 110 048 PAN: AABFF 0837 D ITA NO: 4013 /DEL/201 1 AY : 200 7 - 08 ITA NO: 609 /DEL/201 2 AY : 200 8 - 09 ITA NO: 4493 /DEL/201 3 AY : 20 09 - 10 ACIT, CENTRAL CIRCLE 18 VS. FIRST FLEXIPACK CORPORATION NEW DELHI NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. SURESH ANANTHARAMAN, FCA . RESPONDENT BY : SH.H ARI K UMAR SHARMA, SR.D.R. O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER ALL THESE APPEALS ARE HEARD TOGETHER AND DISPOSED OF BY WAY OF THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE, AS COMMON ISSUE IS INVOLVED IN ALL TH ESE APPEALS. APPEALS FOR THE A.Y. 2007 - 08, 2008 - 09 AND 2009 - 10 2 ARE FILED BY THE REVENUE AND APPEALS FOR THE A.Y. 2006 - 07, 2009 - 10 AND 2010 - 11 ARE FILED BY THE ASSESSEE. 2. THE ASSESSEE IS A PARTNERSHIP FIRM AND IS HAVING AN INDUSTRIAL UNDERTAKING IN THE STATE OF JAMMU & KASHMIR. IT IS ENGAGED IN THE MANUFACTURE OF FLEXIBLE PACKAGING MATERIAL MAINLY USED IN FFMCGINDUSTRIES FOR PACKING FINISHED GOODS. THE ASSESSEE CLAIMS DEDUCTION U/S 80 IB OF THE INCOME TAX ACT, 1961 (THE ACT). THE ISSUE BEFORE US IS WH ETHER THE EXCISE DUTY REFUND RECEIVED BY THE ASSESSEE IN PURSUANCE OF THE NEW INDUSTRIAL POLICY ARE CAPITAL IN NATURE. 2.1. THIS IS THE SECOND ROUND OF APPELLATE PROCEEDINGS BEFORE THE ITAT. EARLIER VIDE ITS ORDER DT. 3 RD JANUARY, 2014, THE TRIBUNAL HAD A T PARA 15 HELD AS FOLLOWS. 15. IT IS ALSO NOTED THAT FOR THE A.Y. 2007 - 08 AND 2008 - 09 THE LD.CIT(A) HAS ALLOWED THE ADDITIONAL GROUND OF THE ASSESSEE THAT THE ISSUE HAS TO BE DECIDED IN FAVOUR OF THE ASSESSEE IN AS MUCH AS THE IMPUGNED AMOUNT IS CAPITAL R ECEIPT. HOWEVER, WE FIND THAT WE HAVE ALREADY HELD HEREINABOVE THAT THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S 80 IB OF THE ACT ON THE IMPUGNED AMOUNTS AND THE DECISION OF THE HON BLE JURISDICTIONAL HIGH COURT IN THE CASE OF DHARAMCHAND PREMCHAND (SUPRA) IS SQUARELY APPLICABLE. HENCE, WE FIND THAT THE ADJUDICATION ON THE ISSUE AS TO WHETHER THE IMPUGNED AMOUNT IS CAPITAL RECEIPT OR NOT IS ONLY OF ACADEMIC INTEREST, HENCE, WE ARE NOT DEALING WITH THE SAME. 2.2. SUBSEQUENTLY THIS ORDER WAS RECALLED PURSUA NT TO AN M.A. FILED BY THE ASSESSEE TO CONSIDER THE CONTENTION OF THE ASSESSEE THAT THE EXCISE DUTY REFUND IS A CAPITAL RECEIPT. THUS THE MATTER IS BEFORE US. 3. AFTER HEARING RIVAL CONTENTIONS WE FIND THAT THE HON BLE JAMMU & KASHMIR HIGH COURT IN THE CA SE OF SHREE BALAJEE ALLOYS AND OTHERS VS. CIT (2011) 239 CTR (J&K) 70, CONSIDERED THE VERY SAME ISSUE AND ADJUDICATED AS FOLLOWS. 3 EXCISE REFUND AND INTEREST SUBSIDY RECEIVED BY THE ASSESSEE IN PURSUANCE TO THE INCENTIVES AND SANCTIONED VIDE GOVERNME NT OF INDIA MINISTRY OF COMMERCE AND INDUSTRIES OFFICE MEMORANDUM DT. 14.6.2002 AND CENTRAL EXCISE NOTIFICATION NOS. 56 AND 57 DT. 14 TH NOVEMBER, 2002 AND OTHER NOTIFICATIONS ISSUED ON THE SUBJECT PURSUANT TO INDUSTRIAL POLICY FOR THE STATE OF JAMMU & KASH MIR AS CAPITAL RECEIPT. 3.1. THE HON BLE SUPREME COURT UPHELD THIS DECISION IN CIVIL APPEAL NO.10061 OF 2011 AND OTHER APPEALS CIT, J&K VS. SHREE BALAJEE ALLOYS AND OTHERS VS. CIT V IDE ORDER DT. 19.4.2016. IN FACT THE ASSESSING OFFICER HAD AT PAGE 15 PAR A 16 OF HIS ORDER FOR THE A.Y. 2009 - 10 HAS REFERRED TO THE SAME CENTRAL EXCISE NOTIFICATION NO.56 & 57 DT. 14 TH NOVEMBER, 2002. 3.2. THE LD.D.R. COULD NOT CONTROVERT THE SUBMISSION OF THE ASSESSEE THAT THE NOTIFICATION OF THE MINISTRY OF COMMERCE, GOVT. OF INDIA AND THE INDUSTRIAL POLICY INTRODUCED IN THE STATE OF J&K CONSIDERED THAT THE HON BLE HIGH COURT AND THAT WHICH IS APPLICABLE TO THE ASSESSEE COMPANY A R E THE SAME. UNDER THESE CIRCUMSTANCES WE RESPECTFULLY FOLLOW THE JUDGEMENT OF HON BLE SUPREME CO URT WHICH HELD THAT THE REFUND OF EXCISE DUTY/VAT RECEIVED BY THE ASSESSEE PURSUANT TO THE POLICY OF GOVT. OF INDIA FOR PROMOTION OF INDUSTRIAL POLICY. 4. IN THE RESULT THE APPEALS OF THE ASSESSEE FOR THE A.Y. 2006 - 07, 2009 - 10 AND 2010 - 11 ARE ALLOWED. R EVENUE APPEALS FOR THE A.Y. 2007 - 08, 2008 - 09 AND 2009 - 10 ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 4 T H JANUARY, 2017 . S D / - S D / - (BEENA A PILLAI) (J.SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: THE 2 4 T H JANUARY, 2017 *MANGA 4 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT(A); 5.DR; 6.GU ARD FILE BY O RDER ASST. REGISTRAR