VISTA ENTERTAINMENT P.LTD, MUMBAI V. ACIT 2(3), MUMBAI

ITA 5768/MUM/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0032 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 23-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: POOJA SWAROOP
• Keywords: Depreciation; Cost of acquisition; Tangible material; Difference of opinion; Capital receipt; Change of opinion
• Section: 143(3); 115JB; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.5768/MUM./2015 ( ASSESSMENT YEAR : 2008 09 ) M/S. VISTA ENTERTAINMENT PVT. LTD. PAN AABCV58125D (NOW M/S. PVR LTD. PAN AAACP4526D) LOTUS GRANDEUR GUNDECHA SYMPHONY, VEER DESAI ROAD ANDHERI (WEST), MUMBAI 400 053 . APPELLANT V/S ASSTT. COMMISSIONER OF INCOME TAX CIRCLE 2(3), MUMBAI . RESPONDENT ITA NO.5769/MUM./2015 ( ASSESSMENT YEAR : 2009 10 ) M/S. VISTA ENTERTAINMENT PVT. LTD. PAN AABCV58125D (NOW M/S. PVR LTD. PAN AAACP4526D) LOTUS GRANDEUR GUNDECHA SYMPHONY, VEER DESAI ROAD ANDHERI (WEST), MUMBAI 400 053 . APPELLANT V/S ADDL. COMMISSIONER OF INCOME TAX CIRCLE 2(3), MUMBAI . RESPONDENT ITA NO.5770/MUM./2015 ( ASSESSMENT YEAR : 2011 12 ) M/S. VISTA ENTERTAINMENT PVT. LTD. PAN AABCV58125D (NOW M/S. PVR LTD. PAN AAACP4526D) LOTUS GRANDEUR GUNDECHA SYMPHONY , VEER DESAI ROAD ANDHERI (WEST) , MUMBAI 400 053 . APPELLANT V/S ADDL. COMMISSIONER OF INCOME TAX CIRCLE 2(3), MUMBAI . RESPONDENT 2 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] ITA NO.250/MUM./2016 ( ASSESSMENT YEAR : 2011 12 ) DY. COMMISSIONER OF INCOME TAX CIRCLE 2(3)(1), MUMBAI . APPELLANT V/S M/S. VISTA ENTERTAINMENT PVT. LTD. PAN AABCV58125D (NOW M/S. PVR LTD. PAN AAACP4526D) LOTUS GRANDEUR GUNDECHA SYMPHONY, VEER DESAI ROAD ANDHERI (WEST), MUMBAI 400 053 . RESPONDENT REVENUE BY : MS. POOJA SWAROOP ASSESSEE BY : SHRI SALIL KAPOOR A/W SHRI SUMIT LAL CHANDANI DATE OF HEARING 19.02.2018 DATE OF ORDER 28.02.2018 O R D E R PER BENCH THIS BUNCH CONSISTS OF THREE APPEALS BY THE ASSESSEE AND ONE APPEAL BY THE REVENUE AGAINST TWO SEPARATE ORDERS , BOTH DATED 28 TH OCTOBER 2015, PASSED BY THE LEARNED COMMISSIONER (APPEALS) 6, MUMBAI. WHILE APPEAL S FOR THE ASSESSMENT YEAR S 2008 09 AND 2009 10 ARE BY THE ASSESSEE ONLY, THERE ARE CROSS APPEALS FOR ASSESSMENT YEAR 2011 12. SINCE , THESE APPEALS PERTAIN TO THE SAME ASSESS EE INVOLVING COMMON ISSUE ARISING OUT OF IDENTICAL SET OF FACTS AND CIRCUMSTANCES, THEREFORE, AS A MATTER OF CONVENIENCE, THESE APPEALS 3 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY WAY OF THIS CONSOLIDATED ORDER. ITA NO. 5768 /MUM./2015 A.Y. 2008 09 AND ITA NO. 5769 /MUM./2015 A.Y. 2009 10 ASSESSEE S APPEALS 2 . GROUNDS RAISED IN THESE TWO APPEALS ARE IDENTICAL EXCEPT THE FIGURES. THEREFORE, FOR THE SAKE OF CONVENIENCE, THE GROUNDS RAISED IN ITA NO.5768/MUM./2015 ARE REPRODUCED HEREUNDER: 1. THE LEARNED CIT(A) ERRED IN LAW AND ON FACTS IN UPHOLDING THE ISSUANCE OF NOTICE UNDER SECTION 148 R/W SECTION 147 OF THE ACT. APPELLANT PRAYS THAT THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) R/W SECTION 147 BASED ON MERE CHANGE OF OPINION SHOULD BE QUASH ED BEING BAD IN LAW; 2. THE LEARNED CIT(A) ERRED IN LAW AND ON FACTS IN HOLDING THAT THOUGH THE SUBSIDY RECEIVED IS A CAPITAL RECEIPT THE SAME HAS TO BE REDUCED FROM THE WDV OF THE BOOKS OF ASSETS AND TO ALLOW THE DEPRECIATION ON THE REDUCED VALUE OF WD V ACCORDINGLY. APPELLANT PRAYS THAT THE SUBSIDY COLLECTED IN THE FORM ENTERTAINMENT DUTY OF ` 6,08,46,243 DURING THE YEAR UNDER CONSIDERATION SHOULD BE TREATED AS CAPITAL RECEIPT AND NOT LIABLE TO BE REDUCED FROM WDV OF BLOCK OF ASSETS FOR ALLOW ANCE OF DEP RECIATION; AND 3. APPELLANT CRAVES TO LEAVE, TO ADD, TO ALTER, TO AMEND OR TO MODIFY ALL OR ANY OF THE GROUND OF APPEAL. 3 . IN ADDITION TO THE AFORESAID GROUNDS RAISED IN THE MEMORANDUM OF APPEALS, THE ASSESSEE HAS RAISED FOLLOWING COMMON ADDITIONAL GROU NDS IN BOTH THE APPEALS: 4. THAT THE NOTICE ISSUED UNDER SECTION 148 OF THE ACT AND THE RE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) R/W SECTION 147 OF THE ACT ARE ILLEGAL, BAD IN LAW AND WITHOUT JURISDICTION; 4 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] 5. THAT THE REASONS RECORDED ARE NOT BASED ON ANY TANGIBLE MATERIAL AND AS SUCH THE NOTICE ISSUED UNDER SECTION 148 IS ILLEGAL, BAD IN LAW AND WITHOUT JURISDICTION; 6. THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, IN THE ABSENCE OF ANY FRESH MATERIAL, THE REASONS RECORDED, NOTI CE ISSUED UNDER SECTION 148 AND RE ASSESSMENT ARE ILLEGAL, BAD IN LAW AND WITHOUT JURISDICTION. 4 . SINCE GROUNDS NO.4, 5 AND 6 RAISED AS ADDITIONAL GROUNDS ARE ONLY EXTENSION OF MAIN GROUND NO.1 AND FURTHER , SINCE , THE ISSUES RAISED IN THESE GROUNDS ARE PUR ELY LEGAL AND JURISDICTIONAL ISSUES GOING TO THE ROOT OF THE MATTER AND CAN BE DECIDED ON THE BASIS OF FACTS AVAILABLE ON RECORD, WE ADMIT THE ADDITION AL GROUND S FOR ADJUDICATION. 5 . AS STATED EARLIER, IN GROUNDS NO.1, 4, 5 AND 6, THE ASSESSEE HAS CHALLENGED THE VALIDITY OF THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) R/W SECTION 147 OF THE ACT. IN GROUND NO.2, ASSESSEE HAS CHALLENGED THE REDUCTION OF ENTERTAINMENT TAX SUBSIDY FROM THE COST OF ASSETS FOR THE PURPOSE OF DEPRECIATION. 6 . BRIEF FACTS ARE, THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS OF MULTIPLEX THEATRE. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED ITS RETURN OF INCOME ON 23 RD SEPTEMBER 2008, DECLARING TOTAL INCOME OF ` 7,25,29,883 UNDER THE NORMAL PROVISIONS AND BOO K PROFIT OF ` 7,65,62,158 UNDER SECTION 115JB OF THE ACT. THE RETURN OF INCOME FILED BY THE ASSESSEE WAS SELECTED FOR SCRUTINY AND 5 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] ASSESSMENT ORDER UNDER SECTION 143(3) OF THE ACT WAS ORIGINALLY PASSED ON 10 TH DECEMBER 2010 DETERMINING THE TOTAL INCOME AT ` 8,36,49,253. SUBSEQUENTLY, THE ASSESSING OFFICER BEING OF THE OPINION THAT IN VIEW OF SUBSIDY ON ENTERTAINMENT TAX GRANTED BY THE STATE GOVERNMENT THE COST OF ACQUISITION OF ALL THE ASSETS ON WHICH THE ASSESSEE HAS CLAIMED DEPRECIATION HAS BECOME NIL AS PER SECTION 43(1), THE ALLOWANCE OF DEPRECIATION TO THE ASSESSEE ON SUCH ASSETS HAS RESULTED IN ESCAPEMENT OF INCOME. ACCORDINGLY, HE RE OPENED THE ASSESSMENT UNDER SECTION 147 OF THE ACT BY ISSUING NOTICE UNDER SECTION 148 ON 16 TH MARCH 2013 AND ULTIMATEL Y PASSED THE ASSESSMENT ORDER UNDER SECTION 143(3) R/W SECTION 147 OF THE ACT DISALLOWING DEPRECIATION CLAIMED OF ` 81,95,591 BY THE ASSESSEE. THE ASSESSMENT ORDER SO PASSED WAS CHALLENGED BEFORE THE FIRST APPELLATE AUTHORITY, INTER ALIA, ON THE GROUND OF VALIDITY OF RE OPENING OF ASSESSMENT UNDER SECTION 147 OF THE ACT. HOWEVER, THE LEARNED COMMISSIONER (APPEALS) DID NOT FIND MERIT IN THE SUBMISSIONS OF THE ASSESSEE WITH REGARD TO ASSESSEES CHALLENGE ON THE ISSUE OF RE OPENING OF ASSESSMENT. 7 . LEARNED AUTH ORISED REPRESENTATIVE SUBMITTED, DURING THE ORIGINAL ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER HAS SPECIFICALLY ENQUIRED INTO AND EXAMINED THE ISSUE RELATING TO THE NATURE OF REIMBURSEMENT OF ENTERTAINMENT TAX COLLECTED AND ALSO THE APPLICABILITY OF SEC TION 43(1). HE SUBMITTED, AFTER EXAMINING THE ISSUE IN DETAIL AND KEEPING IN 6 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] VIEW THE SUBMISSIONS MADE BY THE ASSESSEE THE ASSESSING OFFICER COMPLETED ASSESSMENT BY HOLDING THAT THE ENTERTAINMENT TAX SUBSIDY RECEIVED BY THE ASSESSEE WAS OF REVENUE NATURE, HENCE, TO BE TREATED AS INCOME. LEARNED AUTHORISED REPRESENTATIVE SUBMITTED , THE ASSESSING OFFICER HAVING ENQUIRED INTO AND EXAMINED THE ISSUE IN THE ORIGINAL ASSESSMENT PROCEEDINGS , IN THE ABSENCE OF ANY TANGIBLE AND FRESH MATERIAL COMING TO THE POSSESSIO N OF THE ASSESSING OFFICER ASSESSMENT CANNOT BE RE OPENED MERELY ON A CHANGE OF OPINION. THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED, P O ST ORIGINAL ASSESSMENT PROCEEDINGS NO FRESH MATERIAL HAS COME TO THE POSSESSION OF THE ASSESSING OFFICER TO FORM A B ELIEF THAT INCOME HAS ESCAPED ASSESSMENT. ONLY ON RE EXAMINATION OF THE MATERIALS AVAILABLE ON RECORD AND CONSIDERED IN THE ORIGINAL ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER HAS RE OPENED THE ASSESSMENT WHICH IS LEGALLY IMPERMISSIBLE. IN SUPPORT OF HIS CONTENTION, THE LEARNED AUTHORISED REPRESENTATIVE RELIED UPON THE FOLLOWING DECISIONS: I ) CIT V/S KELVINATOR OF INDIA, 320 ITR 561; II ) HINDUSTAN LIVER LTD V/S R.B. WADKAR, 268 ITR 332; III ) SABH INFRASTRUCTURES LTD. V/S ACIT, 398 ITR 198; IV ) INDULATA RANGWALA V/S DCI T, 384 ITR 337; AND V ) NDT SYSTEMS V/S ITO, 363 ITR 603. 7 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] 8 . LEARNED AUTHORISED REPRESENTATIVE SUBMITTED , EVEN OTHERWISE ALSO THE ISSUE ON WHICH THE ASSESSMENT WAS RE OPENED UNDER SECTION 147 OF THE ACT HAVING ALREADY BEEN DECIDED IN FAVOUR OF THE ASSESSEE THE RE OPENING UNDER SECTION 147 OF THE ACT BECOMES A FUTILE EXERCISE. HE SUBMITTED, SO FAR AS THE NATURE OF ENTERTAINMENT TAX SUBSIDY IS CONCERNED, THERE CANNOT BE ANY MANNER OF DOUBT THAT IT IS IN THE NATURE OF CAPITAL RECEIPT, HENCE, NOT TAXABLE. HE SU BMITTED, NOT ONLY THE HONBLE SUPREME COURT IN CASE OF CIT V/S CHAPHALKAR BROTHERS, [2018] 400 ITR 279, HAS HELD THE ENTERTAINMENT TAX SUBSIDY PROVIDED BY THE GOVERNMENT TO MULTIPLEX THEATRE COMPLEXES A S CAPITAL IN NATURE , BUT , THE HON'BLE JURISDICTIONAL H IGH COURT IN ASSESSEES OWN CASE HAS ALSO HELD SO. HE SUBMITTED, IN SO FAR AS THE ISSUE WHETHER ENTERTAINMENT TAX SUBSIDY SHOULD BE REDUCED FROM THE COST OF ASSETS IN TERMS OF EXPLANATION 10 TO SECTION 43(1) FOR COMPUTING DEPRECIATION IS CONCERNED, THE TRI BUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010 11 IN ITA NO.6954/MUM./2013 DATED 22 ND APRIL 2016, HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE FOLLOWING OTHER DECISIONS OF THE SAME BENCH INCLUDING THE DECISION IN CASE OF ASSESSEES SISTER CONCERN . THEREFORE, THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED , THE IMPUGNED ASSESSMENT ORDER CANNOT BE SUSTAINED BOTH ON LEGAL GROUND AS WELL AS ON MERITS. 8 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] 9 . LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED, THE ISSUE WHETHER THE ENTERTAINMENT TAX SUBSIDY IS T O BE REDUCED FROM THE COST OF ASSET UNDER SECTION 43(1) OF THE ACT FOR COMPUTING DEPRECIATION WAS NEVER EXAMINED BY THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEEDINGS , SINCE , HE TREATED THE ENTERTAINMENT TAX SUBSIDY RECEIVED BY TH E ASSESSEE AS RE VENUE RECEIPT. SHE SUBMITTED, THAT BEING THE CASE , THERE IS NO CHANGE OF OPINION WHILE RE OPENING OF ASSESSMENT. AS FAR AS THE MERITS OF THE ISSUE ARE CONCERNED THE LEARNED DEPARTMENTAL REPRESENTATIVE RELIED UPON THE OBSERVATIONS OF THE LEARNED COMMISSIONE R (APPEALS). 10 . WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO APPLIED OUR MIND TO THE DECISIONS RELIED UPON. UNDISPUTEDLY, IN THE RELEVANT PREVIOUS YEAR THE ASSESSEE HAS RECEIVED THE ENTERTAINMENT TAX COLLECTED BY IT FROM THE MULTIPLEXES AS SUBSIDY AS PER THE SCHEME OF MAHARASHTRA GOVERNMENT. IN THE COURSE OF THE ORIGINAL ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER SPECIFICALLY ENQUIRED INTO AND EXAMINED NOT ONLY THE NATURE AND CHARACTER OF THE ENTERTAINMENT TAX SUBS IDY RECEIVED BY THE ASSESSEE , WHETHER REVENUE OR CAPITAL , BUT HE ALSO RAISED QUERY WITH REGARD TO APPLICABILITY OF SECTION 43(1). THIS IS VERY MUCH EVIDENT FROM THE ORIGINAL ASSESSMENT ORDER DATED 10 TH DECEMBER 2010, PASSED UNDER SECTION 143(3), A COPY OF WHICH IS AT PAGE 48 OF THE PAPER BOOK. AFTER ISSUING A SHOW CAUSE 9 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] NOTICE TO THE ASSESSEE AND INVITING ASSESSEES REPLY BOTH ON THE ISSUE OF NATURE OF RECEIPT AS WELL AS APPLICABILITY OF SECTION 43 (1) E XPLANATION 10, THE ASSESSING OFFICER ON EXAMINING THE SUBMISSIONS OF THE ASSESSEE AS WELL AS VARIOUS ASPECTS OF THE ISSUE IN HIS OWN WISDOM TREATED THE ENTERTAINMENT TAX SUBSIDY RECEIVED BY TH E ASSESSEE AS REVENUE IN NATURE AND ACCORDINGLY, ADDED IT TO THE INCOME OF THE ASSESSEE. THEREFORE, IT IS EVIDENT THAT THE ASSESSING OFFICER HAS EXAMINED THE ISSUE OF APPLICABILITY OF SECTION 43(1) EXPLANATION 10 DURING THE ORIGINAL ASSESSMENT. FROM THE REASONS RECORDED FOR RE OPENING OF ASSESSMENT UNDER SECTION 147 OF THE ACT WHICH IS REPRODUCED BY THE ASSESSING OFFICER IN THE IMPUGNED ASSESSMENT ORDER IT IS EVIDENT THAT THE FORMATION OF BELIEF F OR ESCAPEMENT OF INCOME IS ON THE REASON THAT THE ENTERTAINMENT TAX SUBSIDY RECEIVED BY THE ASSESSEE SHOULD BE REDUCED FROM C OST OF ASSETS , THEREBY , NO DEPRECIATION IS ALLOWABLE TO THE ASSESSEE ON SUCH ASSETS. FROM THE REASONS RECORDED, IT IS VERY MUCH EVIDENT THAT AT THE TIME OF RECORDING OF REASONS FOR RE OPENING OF ASSESSMENT NO FRESH TANGIBLE MATERIAL WAS AVAILABLE WITH THE ASSESSING OFFICER. ON MERE RE VISIT AND RE APPRAISAL OF THE MATERIALS ALREADY AVAILABLE ON RECORD AND CONSIDERED BY THE ASSESSING OFFICER IN ORIGINAL ASSESSMENT PROCEEDINGS , THE ASSESSING OFFICER FORMED AN OPINION THAT INCOME HAS ESCAPED ASSESSMENT. THUS, IT IS PATENT AND OBVIOUS THAT THE RE OPENING OF 10 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] ASSESSMENT IS ON A MERE CHANGE OF OPINION. THOUGH, THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEEDINGS, HAS NOT EXPRESSED ANY OPINION WITH REGARD TO THE APPLICABILITY OF EXPLANATION 10 TO SECTION 423 (1), HOWEVER, IT IS EVIDENT THAT HE HAD EXAMINED THE ISSUE IN THE ORIGINAL ASSESSMENT PROCEEDINGS. IF HE HAD ANY DOUBT HE CERTAINLY WOULD HAVE MENTIONED IN THE ASSESSMENT ORDER THAT IN THE EVENT OF THE RECEIPT BEING HELD AS CAPITAL IN NATURE , THE SUBSIDY R ECEIVED SHOULD HAVE BEEN REDUCED FROM THE ACTUAL COST FOR COMPUTING DEPRECIATION. HAVING NOT STATED SO IN THE ORIGINAL ASSESSMENT ORDER CANNOT LEAD TO THE CONCLUSION THAT THE ASSESSING OFFICER HAS CONSIDERED THE ISSUE AT ALL. THAT BEING THE CASE, IN THE AB SENCE OF ANY FRESH TANGIBLE MATERIAL, THE RE OPENING OF ASSESSMENT UNDER SECTION 147 IN THE PRESENT CASE IS INVALID AS IT TANTAMOUNT S TO RE OPENING ON A MERE CHANGE OF OPINION. THE DECISION RELIED UPON BY THE LEARNED AUTHORISED R EPRESENTATIVE SQUARELY SUPP ORT THIS VIEW. THEREFORE, WE HAVE NO HESITATION IN HOLDING THAT THE IMPUGNED ASSESSMENT ORDER PASSED UNDER SECTION 143(3) R/W SECTION 147 OF THE ACT IS LEGALLY UNSUSTAINABLE, HENCE, DESERVES TO BE QUASHED. HAVING HELD SO, THOUGH, IT IS NOT NECESSARY TO DEL VE INTO THE MERITS OF THE ISSUE, HOWEVER, CONSIDERING THE FACT THAT WE HAVE HEARD THE PARTIES ON MERITS AND IT IS A RECURRING ISSUE BETWEEN THE PARTIES EVEN IN THE SUBSEQUENT ASSESSMENT YEAR, WE PROCEED TO DEAL WITH THE MERITS AS WELL. IT IS EVIDENT, THE D EPARTMENTAL AUTHORITIES HA VE 11 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] DISALLOWED ASSESSEES CLAIM OF DEPRECIATION ON THE REASONING THAT THE ENTERTAINMENT TAX SUBSIDY BEING IN THE NATURE OF CAPITAL RECEIPT SHOULD BE REDUCED FROM THE COST OF ASSET IN TERMS OF EXPLANATION 10 TO SECTION 43(1) FOR COM PUTING DEPRECIATION. HOWEVER, AS BROUGHT TO OUR NOTICE BY THE LEARNED AUTHORISED REPRESENTATIVE , IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2010 11, THE TRIBUNAL WHILE DECIDING IDENTICAL ISSUE FOLLOWED OTHER DECISIONS OF THE CO ORDINATE BENCH AND HELD THAT ENTERTAINMENT TAX SUBSIDY CANNOT BE REDUCED FROM THE COST OF ASSETS FOR COMPUTING DEPRECIATION AND ACCORDINGLY ALLOWED ASSESSEES CLAIM OF DEPRECIATION. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAVING NOT BROUGHT TO OUR NOTICE ANY MATERIAL DIFFERENCE I N FACTS OR ANY CONTRARY DECISION , ADHERING TO THE NORMS OF JUDICIAL DISCIPLINE WE FOLLOW THE DECISION OF THE CO ORDINATE BENCH IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010 11 AS REFERRED TO ABOVE AND ALLOW ASSESSEES CLAIM O F DEPRECIATION. THEREFORE, GR OUNDS RAISED ARE ALLOWED. 11 . IN THE RESULT, ASSESSEES APPEAL S FOR A.Y. 2008 09 AND 2009 10 ARE ALLOWED. ITA NO. 5770 /MUM./2015 ASSESSEE S APPEALS FOR A.Y. 2011 12 12 . THE ONLY EFFECTIVE GROUND RAISED BY THE ASSESSEE READS AS UNDER: 12 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] APPELLANT PRAYS THAT THE ENTERTAINMENT TAX OF ` 4,44,52,684 COLLECTED DURING THE YEAR UNDER CONSIDERATION CANNOT BE REDUCED FROM THE WDV AND BLOCK OF ASSETS FOR THE PURPOSE OF CLAIM OF DEPRECIATION BY APPLYING EXPLANATION 10 TO SEC. 43(1) OF THE ACT. 13 . WHILE DECIDING THE ISSUE RAISED IN GROUND NO.2 BY THE ASSESSEE IN ITS APPEAL BEING ITA NO.5768/MUM./2015, WE HAVE ALLOWED ASSESSEES CLAIM OF DEPRECIATION. FOLLOWING OUR DECISION THEREIN VIDE PARA 10 ABOVE, WE ALLOW ASSESSEES CLAIM OF DEPRECIATION. GROUND RAISED IS ALLOWED. 14 . IN THE RESULT, ASSESSEES APPEAL FOR A.Y. 2011 12 IS ALLOWED. ITA NO. 250 /MUM./201 6 REVENUES APPEAL FOR A.Y. 2011 12 15 . THE ONLY EFFECTIVE GROUND RAISED BY THE REVENUE READS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER (APPEALS) ERRED IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ENTERTAINMENT TAX HOLDING THAT NON PAYMENT OF ENTERTAINMENT TAX COLLECTED FROM THE CUSTOMERS CONSTITUTES SUBSIDY FROM THE STATE G OVERNMENT AND IS A CAPITAL RECEIPT AND NOT A REVENUE RECEIPT. 16 . BRIEF FACTS ARE, WHILE COMPLETING THE ASSESSMENT FOR THE IMPUGNED ASSESSMENT YEAR, THE ASSESSING OFFICER TREATED THE ENTERTAINMENT TAX SUBSIDY RECEIVED BY TH E ASSESSEE FROM THE STATE GOVERNMEN T AMOUNTING TO ` 4,44,52,684, AS REVENUE IN NATURE AND 13 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] ADDED BACK TO THE INCOME OF THE ASSESSEE. HOWEVER, THE FIRST APPELLATE AUTHORITY RELYING UPON HIS OWN DECISION AND THE DECISIONS OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR EARLIER ASSESSMENT YEARS HELD THE ENTERTAINMENT TAX SUBSIDY RECEIVED BY THE ASSESSEE TO BE CAPITAL RECEIPT, HENCE, NOT TAXABLE. 17 . WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED MATERIAL AVAILABLE ON RECORD. AS DISCUSSED IN THE EARLIER PART OF ORDER , IN ASSESSEES OWN CASE FOR ASSESSMENT Y EAR S 2008 09 AND 2009 10, THE HON'BLE JURISDICTIONAL HIGH COURT WHILE DISMISSING THE REVENUES APPEAL HAS UPHELD THE DECISION OF THE TRIBUNAL IN TREATING THE ENTERTAINMENT TAX SUBSIDY RECEIVED BY THE ASSESSEE FROM THE STATE GOVERNMENT AS CAPITAL RECEIPT. T HE TRIBUNAL HAS AGAIN REITERATED THE SAME VIEW IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010 11 IN ITA NO.7380/ MUM./2013, DATED 20 TH JULY 2016. IN FACT, THE ISSUE RELATING TO THE NATURE OF ENTERTAINMENT TAX SUBSIDY GIVEN TO MULTIPLEXES THEATRE BY THE ST ATE GOVERNMENT HAS ATTAINED FINALITY BY THE DECISION OF THE HON'BLE SUPREME COURT IN CHAPHALKAR BROTHERS (SUPRA ) , WHEREIN THE HON'BLE SUPREME COURT CONSIDERING THE VERY SAME ISSUE RELATING TO THE NATURE OF ENTERTAINMENT TAX SUBSIDY GRANTED BY THE STATE GOV ERNMENT HAS HELD IT TO BE OF CAPITAL IN NATURE. IN VIEW OF THE AFORESAID, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED COMMISSIONER (APPEALS) ON THE ISSUE. GROUND RAISED IS DISMISSED. 14 M/S. VISTA ENTERTAINMENT PVT. LTD. [ NOW M/S. PVR LTD. ] 18 . IN THE RESULT, REVENUES APPEAL FOR A.Y. 2011 12 IS DISMISSED. 19 . TO SUM UP, ASSESSEES APPEALS FOR A.YS 2008 09, 2009 10 AND 2011 12 ARE ALLOWED AND REVENUES APPEAL FOR A.Y. 2011 12 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28.02 .2018 SD/ - RAJESH KUMAR ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 28.02 .2018 COPY OF THE ORDER FORWARDED TO : ( 1 ) THE ASSESSEE; ( 2 ) THE REVENUE; ( 3 ) THE CIT(A); ( 4 ) THE CIT, MUMBAI CITY CONCERNED; ( 5 ) THE DR, ITAT, MUMBAI; ( 6 ) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY (ASSTT. REGISTRAR/SR.P.S) ITAT, MUMBAI