ACIT, New Delhi V. M/s. Garg Acrylics Ltd., New Delhi

ITA 777/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61666 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 08-05-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 07-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RIS GILL
• Keywords: Source of fund; Capital receipt

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : C : NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO. 777/DEL/2011 ASSESSMENT YEAR : 2007-08 ACIT, CIRCLE 12 (1), NEW DELHI. VS. M/S GARG ACRYLICS LTD., 209, MG HOUSE, COMMUNITY CENTRE, WAZIRPUR INDL. AREA, NEW DELHI 110 052. PAN : AAACG3332N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHWANI KUMAR, CA RESPONDENT BY : SHRI R.I.S. GILL, CIT, DR O R D E R PER I.P. BANSAL, JUDICIAL MEMBER: THIS IS AN APPEAL FILED BY THE REVENUE. IT IS DIRECT ED AGAINST THE ORDER OF THE CIT (A) DATED 15 TH NOVEMBER, 2010 FOR ASSESSMENT YEAR 2007-08. THE GROUNDS OF APPEAL READ AS UNDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE ORDER OF THE CIT (A) IS ERRONEOUS, PERVERSE, ILLEGAL AND AGAINST THE PROVISIONS OF LAW WHICH IS LIABLE TO BE SET ASIDE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) HAS ERRED IN DELETING THE DISALLOWANCE OF RS.2,29,30,874/- MADE BY THE A.O. ON ACCOUNT OF SALES TAX SUBSIDY RECEIVED BY THE ASSESSEE. ITA NO.777/DEL/2011 2 3. THE APPELLANT CRAVES TO LEAVE TO ADD, ALTER OR AMEND ANY GROUND OF APPEAL RAISED ABOVE AT THE TIME OF THE HEARING. 2. THE SALES-TAX SUBSIDY RECEIVED BY THE ASSESSEE AMOUNTIN G TO ` 2,29,30,874/- HAS BEEN CONSIDERED TO BE ON REVENUE AC COUNT BY THE ASSESSING OFFICER AS AGAINST THE CLAIM OF THE ASSESSEE THAT THE SAID RECEIPT IS ON CAPITAL ACCOUNT. THOUGH THE ASSESSING OFF ICER HAS NOT MADE ANY REFERENCE TO THE EARLIER YEARS IN WHICH ALSO THE ASSESSEE HAD RECEIVED SIMILAR RECEIPTS, BUT LD. CIT (A) HAS GRANTED THE RELIEF TO THE ASSESSEE ON THE BASIS OF DECISION OF CIT (A) IN RESPECT OF ASSESSMENT YEAR 2006-07 AND AFTER REPRODUCING THE OBSERVATIONS O F CIT (A) ON THIS ISSUE, LD. CIT (A), FOR THE IMPUGNED YEAR, HAS GRANTED THE RELIEF TO THE ASSESSEE AND, IN THIS MANNER, THE ADDITION OF ` 2,29,30,874/- HAS BEEN DELETED. 3. AT THE OUTSET, IT WAS POINTED OUT BY LD. AR THAT T HE ORDER OF THE CIT (A) IN RESPECT OF ASSESSMENT YEAR 2006-07 HAS BEEN UP HELD BY ITAT VIDE ITS ORDER DATED 30 TH DECEMBER, 2010 IN ITA NO.1559/DEL/2010. HE HAS PLACED BEFORE US COPY OF TH E SAID ORDER AND IT WAS HELD BY THE TRIBUNAL THAT THE CIT (A) WAS RIGH T IN DELETING THE ADDITION. IT WAS FURTHER SUBMITTED THAT FOR ASSESSMENT YEAR 2008-09 ALSO THE AFOREMENTIONED DECISION OF THE TRIBUNAL WAS F OLLOWED BY ITAT IN THE CASE OF THE ASSESSEE WHEREIN THE ADDITION WAS SUSTAI NED BY CIT (A). HE, IN THIS REGARD, REFERRED TO THE ORDER OF T HE TRIBUNAL DATED 31 ST JANUARY, 2012 IN ITA NO.5227/DEL/2011. THUS, IT WAS PLEADED BY LD. AR THAT THE ISSUE RAISED BY THE REVENUE IS COVERED IN FAVO UR OF THE ASSESSEE FOR THE AFOREMENTIONED DECISION OF THE TRIBUNAL . 4. HOWEVER, LD. DR RELIED UPON THE ORDER PASSED BY TH E ASSESSING OFFICER. ITA NO.777/DEL/2011 3 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS IN THE LIGHT OF THE MATERIAL PLACED BEFORE US. THE IMPUGNED ASSESSMENT YEAR IS ASSESSMENT YEAR 2007-08. FOR THE EARLIER YEAR AS WELL A S FOR THE SUBSEQUENT YEAR THE TRIBUNAL HAS CONSIDERED THIS ISSUE AND IT HAS BEEN HELD THAT THE SUBSIDY RELIEVED BY THE ASSESSEE IS ON ACC OUNT OF CAPITAL, HENCE, NOT ASSESSABLE AS REVENUE. IT IS OBSERVED FROM THE ORDER OF ITAT FOR 2008-09 THAT THE DEPARTMENT TRIED TO DISTIN GUISH THE EARLIER DECISION OF ITAT, BUT, IT WAS FOUND BY THE TRIBUNAL T HAT IT WAS NOT DISTINGUISHABLE AND WAS APPLICABLE TO ASSESSMENT YEAR 200 8-09. FOR THE SAKE OF COMPLETENESS THE ORDER OF THE TRIBUNAL FOR ASSESSMENT YEAR 2008-09 IN THIS REGARD IS REPRODUCED BELOW:- 2. GROUND NO.1 OF THE ASSESSEES APPEAL READS AS UND ER:- THAT THE ORDER U/S 250 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-XV, NEW DELHI IS AGAINST LAW AND FACTS AND ON THE FILE IN AS MUCH AS HE WAS NOT JUSTIFIED TO UPHOLD THE ACTION OF THE LEARNED DCIT, CIRCLE-12(1), NEW DELHI IN MAKING AN ADDITION OF RS.2,58,10,056/- BY HOLDING THAT THE SALES TAX SUBSIDY GRANTED BY THE STATE OF PUNJAB WAS IN THE NATURE OF A REVENUE RECEIPT AND NOT A CAPITAL RECEIPT. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATE RIAL PLACED BEFORE US. WE FIND THIS ISSUE TO BE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF ITAT IN ASS ESSEES OWN CASE FOR THE AY 2006-07 WHEREIN THE ITAT, WHILE DISPO SING OF THE CROSS-APPEAL OF THE REVENUE IN ITA NO.1559/DEL/2010 AND, AFTER DISCUSSING AT LENGTH, HELD AS UNDER:- 18. THE NEXT DISPUTE IN THE REVENUES APPEAL READS AS UNDER: 3. ON THE FACTS AND CIRCUMSTANCES, WHETHER LD. CIT(APPEALS) WAS JUSTIFIED ON FACTS OF THE CASE AND IN LAW IN DELETING THE DISALLOWANCE OF RS.2,46,12,660/- ON ACCOUNT OF SUBSIDY RECEIVED BY THE ASSESSEE COMPANY AND CLAIMED AS CAPITAL RECEIPT WHEREAS THE AO HAS RIGHTLY TREATED THE SAME AS REVENUE RECEIPT AND DISALLOWED THE SAME CITING VARIOUS JUDICIAL PRONOUNCEMENTS. ITA NO.777/DEL/2011 4 THE ASSESSEE COMPANY HAD BEEN GRANTED SALES-TAX SUBSIDY BY THE STATE OF PUNJAB TO THE TUNE OF RS 12.45 CRORES. DURING THE RELEVANT YEAR, THE ASSESSEE HAD CLAIMED AN AMOUNT OF RS.2,46,12,660/- BEING UTILIZED OUT OF THE TOTAL SUBSIDY AND THE SAME HAS BEEN TREATED AS CAPITAL RECEIPT. WHEN ASKED TO JUSTIFY THE TREATMENT OF SUBSIDY OF SALES-TAX DONE IN THE COMPUTATION OF INCOME, THE ASSESSEE SUBMITTED A COPY OF THE POLICY OF THE PUNJAB GOVERNMENT AND THE ASSESSEE STATED THAT: THE COMPANY HAS SET UP UNIT NO.II IN THE FINANCIAL YEAR 2001-02. THE FIXED CAPITAL INVESTMENT OF RS.8.30 CRORES HAS BEEN INCURRED ON IT. WITH A VIEW TO ENCOURAGE THE SETTING UP OF NEW INDUSTRIAL UNITS IN THE STATE OF PUNJAB, THE STATE GOVERNMENT HAS GRANTED SUBSIDY IN THE NATURE OF SALES TAX EXEMPTION TO NEW UNITS @ 150% OF THE AMOUNT INVESTED IN LAND & BUILDING, PLANT & MACHINERY ETC. IN ACCORDANCE WITH THE SCHEME AN AMOUNT OF RS.12.45 CRORES HAS BEEN GRANTED AS SALES TAX SUBSIDY TO THE COMPANY. DURING THE FINANCIAL YEAR 01.04.2005 TO 31.03.2006 (ASSESSMENT YEAR 2006- 07) AN AMOUNT OF RS.2,46,12,660/- HAS BEEN UTILIZED OUT OF THE TOTAL SUBSIDY. SINCE THEN SAME IS IN THE NATURE OF CAPITAL RECEIPT, IT HAS BEEN DEDUCTED FROM THE ASSESSABLE INCOME FOR THE A.Y 2006-07. 18.1 THE ASSESSEE WAS ASKED BY THE AO, AS TO WHY NOT THE SALES TAX SUBSIDY MAY BE TREATED AS REVENUE RECEIPT. THE ASSESSEE DID NOT REPLY AND THE AO, APPLYING THE PRINCIPLE OF THE DECISION OF THE SUPREME COURT IN THE CASE OF SAHNEY STEEL AND PRESS WORKS LTD. VS. CIT 228 ITR 253 (SC) CAME TO THE CONCLUSION THAT THE SALES TAX INCENTIVE RECEIVED BY THE ASSESSEE IS CLEARLY ON THE REVENUE ACCOUNT AND NOT CAPITAL RECEIPT AS CLAIMED BY IT. THE ADDITION OF RS.2,46,12,660/- WAS MADE. 19. THE CIT (APPEALS) EXAMINED THE CASE OF THE ASSESSEE AND GAVE THE FOLLOWING FINDINGS: 19. I HAVE CONSIDERED THE SUBMISSIONS OF THE APPELLANT, FINDINGS OF THE AO AND THE FACTS ON RECORD. PERUSAL OF THE PUNJAB GENERAL SALES TAX ACT, 1948 SHOWS THAT THE STATE GOVERNMENT HAS EXEMPTED CERTAIN CLASS OF INDUSTRIES FROM PAYMENT OF SALES TAX WHICH HAVE BEEN DEFENDING PUNJAB GENERAL SALES TAX DEFINED IN THE PUNJAB AND EXEMPTION RULES, 1991. IT IS STATED THAT IT WILL APPLY ITA NO.777/DEL/2011 5 TO UNITS WHEREIN MODERNIZATION, EXPANSION OR DIVERSIFICATION IN TERMS OF INDUSTRIAL POLICY IS CARR IED OUT. INDUSTRIAL POLICY HAS BEEN DEFINED AS THE INDUSTRIAL POLICY OF 1992 OR INDUSTRIAL POLICY OF 199 6 AS THE CASE MAY BE, NOTIFIED BY THE GOVERNMENT OF PUNJAB. AS PER THE PROVISIONS OF THE RULES DEFERMENT OF OR EXEMPTION FROM THE PAYMENT OF TAX UNDER THE ACT IS ADMISSIBLE TO A UNIT IN B GROWTH AREA FOR A PERIOD OF 84 MONTHS. AS PER RULE-4 AND 4A THE QUANTUM OF ENTITLEMENT IN B GROWTH AREA WILL BE 150% OF THE FIXED CAPITAL INVESTMENT. IT HAS BEEN FURTHER MENTIONED THAT THE UNITS WHICH UNDERGO EXPANSION MODERNIZATION SHALL BE ENTITLED TO THE BENEFIT UNDER SUB-RULE (1) WHICH DEFINES THE QUANTUM OF BENEFIT. AS PER THE INDUSTRIAL POLICY,1996 IT HAS BEEN MENTIONED THAT TO ENCOURAGE THE GROWTH OF EXISTING INDUSTRIAL UNITS THE BENEFIT OF INVESTMENT INCENTIVE AND SALES TAX CONCESSION SHALL BE ALLOWED ON EXPANSION PROVIDED THE FIXED CAPITAL INVESTMENT IS INCREASED BY AT LEAST 50%. PERUSAL OF THE ABOVE SCHEMES SHOWS THAT THE INCENTIVE HAS BEEN GRANTED BY THE STATE GOVERNMENT TO INDUCE THE FOSTER RAPID AND WIDE GROWTH OF INDUSTRIALIZATION OF THE STATE. THE QUANTUM OF BENEFIT HAS TO BE WORKED OUT ON THE BASIS OF THE FIXED CAPITAL INVESTMENT MADE BY THE INDUSTRY. IN THE CASE OF THE APPELLANT IT IS OBSERVED THAT THE UNIT IS IN AN AREA WHICH HAS BEEN NOTIFIED AS A SPECIFIED AREA BY THE GOVERNMENT. THE GOVERNMENT OF PUNJAB VIDE ITS NOTIFICATION MENTIONED ABOVE HAS NOTIFIED THAT THE STATE GOVERNMENT WAS OF THE OPINION THAT FOR PROMOTING THE DEVELOPMENT OF CERTAIN INDUSTRIES IN THE STATE IT WAS NECESSARY TO GRANT EXEMPTION FROM SALES TAX TO A NEW UNIT AND ALSO TO UNITS WHICH HAD UNDERTAKEN AN EXTENSION MODERNIZATION OR DIVERSIFICATION. THE AMOUNT OF TAX EXEMPTION ALLOWED WAS ON THE BASIS OF FIXED CAPITAL INVESTMENT MADE BY THE ASSESSEE. THE HONBLE SUPREME COURT IN THE CASE OF SAWHNEY STEEL AND PRESS WORKS LTD. 228 ITR 253 HAS HELD THAT IF MONEY IS GIVEN TO THE ASSESSEE FOR ASSISTING THEM IN CARRYING OUT THEIR BUSINESS OPERATION AND THE MONEY WAS GIVEN ONLY AFTER AND CONDITIONAL UPON THE COMMITMENT OF COMMENCEMENT OF PRODUCTION THE SUBSIDY MUST BE TREATED AS ASSISTANCE FOR THE PURPOSE OF TRADE. IN THE INSTANT CASE THE SUBSIDY HAS BEEN GRANTED TO THE APPELLANT COMPANY BY THE STATE GOVERNMENT NOT FOR THE PURPOSE OF CARRYING OUT ITS BUSINESS IN A MORE PROFITABLE MANNER BUT MERELY IN CONSIDERATION OF SETTING UP OR EXPANDING ITA NO.777/DEL/2011 6 OR MODERNIZING THE PRODUCTION UNITS IN SPECIFIED AREAS. THE DECISION OF THE HONBLE ITAT DELHI BENCH IN THE CASE OF BHUSHAN STEELS AND STRIPS LTD VIDE ITA NO. 113/DELHI/2001 WHICH HAS BEEN RELIED UPON BY THE APPELLANT HAS CONSIDERED THE SAME ISSUE IN WHICH THE FACTS OF THE APPELLANTS CASE ARE SIMILAR. THE HONBLE ITAT HAS HELD THE SUBSIDY TO BE A CAPITAL RECEIPT. THE HONBLE ITAT MUMBAI (SPECIAL BENCH) IN THE CASE OF DCIT VS. RELIANCE INDUSTRIES LTD 88 ITD 273 HAS HELD THAT IF SUBSIDY IS GIVEN FOR SETTING UP FOR EXPANSION OF INDUSTRY IN A BACKWARD AREA, IT WILL BE CAPITAL IRRESPECTIVE OR MODALITY OR SOURCE OF FUNDS THROUGH OR FROM WHICH IT IS GIVEN AND THAT IF MONEY IS GIVEN FOR ASSISTING ASSESSEE IN CARRYING OUT BUSINESS OPERATIONS ONLY AFTER A CONDITION UPON COMMENCEMENT OF PRODUCTION IT WOULD BE REVENUE. THE ABOVE FINDINGS HAVE BEEN GIVEN AFTER CONSIDERING THE DECISIONS IN THE CASE OF SAWHNEY STEEL AND PRESS WORKS LTD AND DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF P.J.CHEMICALS LTD. THE DECISIONS IN THE CASE OF CIT VS. PONNI SUGARS AND CHEMICALS LTD AND CIT VS. DUSAD INDUSTRIES LTD HAVE ALSO BEEN CONSIDERED. IN THE APPELLANTS CASE THE QUANTUM OF THE INCENTIVE DEPENDED ON THE AREA IN WHICH THE INDUSTRY WAS LOCATED. FURTHER THE INCENTIVE WAS SUBJECT TO MONETARY CEILINGS DIRECTLY RELATED TO FIXED CAPITAL INVESTMENT. THUS IT IS SEEN THAT THE SCHEME UNDER WHICH INCENTIVE HAS BEEN GRANTED HAS FOCUS ON THE LOCATION OF INDUSTRY AND THE AMOUNT OF FIXED CAPITAL INVESTMENT. AFTER CAREFUL CONSIDERATION OF THE FACTS OF THE CASE AND ALSO RELYING ON THE DECISION OF THE JURISDICTIONAL BENCH OF ITAT IN THE CASE OF BHUSHAN STEEL AND STRIPS LTD, I AM OF THE CONSIDERED OPINION THAT THE SALES TAX SUBSIDY RECEIVED BY THE APPELLANT IS IN THE NATURE OF CAPITAL RECEIPT. THE DISALLOWANCE MADE BY THE A.O IS DELETED AND THIS GROUND OF APPEAL IS ALLOWED. 20. THE DEPARTMENT IS AGGRIEVED. THE LEARNED D.R. STRONGLY SUPPORTED THE ORDER OF THE A.O. ACCORDING TO HIM THE PRINCIPLE LAID DOWN BY THE SUPREME COURT IN THE CASE OF SAWHNEY STEEL AND PRESS WORKS LTD. (228 ITR 253) ARE CLEARLY APPLICABLE IN RESPECT OF THE SALES-TAX RECEIVED BY THE ASSESSEE. HE ALSO SUBMITTED THAT UNDER THE INCENTIVE SCHEME OF THE GOVERNMENT, THE ASSESSEE IS ONLY ENTITLED TO DEFERMENT OF SALES-TAX PAYMENT, CALCULATED AT A PERCENTAGE OF FIXED CAPITAL INVESTMENT. IN FACT, ACCORDING TO HIM, THE SALES-TAX INCENTIVE WILL BE TREATED AS A DEFERRED LOAN AND THE ASSESSEE IS ITA NO.777/DEL/2011 7 REQUIRED TO REIMBURSE THE SAID LOAN TO THE GOVERNMENT. 21. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HEAVILY RELIED UPON THE ORDER OF THE CIT (A) AND THE FACTS OF HIS CASE, ACCORDING TO HIM, ARE EXACTLY THE SAME TO THE FACTS OF M/S BHUSHAN STEELS & STRIPS LTD., NEW DELHI (ITA NO.3727/DEL/97 DATED 27.02.2003) WHERE IDENTICAL SCHEME HAS GONE IN DETAIL BY THE TRIBUNAL AND THE TRIBUNAL AFTER EXAMINING THE SCHEME HELD THAT THE AMOUNTS IN QUESTION ARE TO BE TREATED AS CAPITAL RECEIPT. IN ALL FORCE, THE ISSUE STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE AFORESAID DECISION OF THE TRIBUNAL. THE DECISIONS OF THE TRIBUNAL ON THIS ISSUE ARE PLACED IN A SEPARATE COMPILATION IN THE FORM OF PAPER BOOK. THE ASSESSEE HAS ALSO FILED THE COPY OF THE CERTIFICATE OF ELIGIBILITY FOR GRANT OF INCENTIVES FOR SALES-TAX EXEMPTION IN THE CASE OF THE ASSESSEE VIDE NO. DIC/LDH/63-E DATED 26.6.03 WHEREIN IT IS CERTIFIED THAT THE ASSESSEE WHICH ESTABLISH THE MANUFACTURING UNIT FOR PRODUCTION OF SYNTHETIC YARN, WOOLEN YARN, PROCESSING WASTE ON 01.03.2002 IS ELIGIBLE FOR GRANT OF INCENTIVES OF SALES-TAX EXEMPTION FOR A PERIOD OF SEVEN YEARS AND FOR THE MAXIMUM AMOUNT OF RS.12,45,30,000/- FROM 01.03.2002. IT IS A CASE OF TOTAL EXEMPTION. THE LEARNED COUNSEL POINTED OUT THE SCHEME PROVIDES FOR TWO OPTIONS, ONE SALES-TAX EXEMPTION AND THE OTHER DEFERRAL SCHEME. THE ASSESSEES UNIT FALLS UNDER THE EXEMPTION SCHEME, UNDER THE SAME INCENTIVE SCHEME ANNOUNCED BY THE GOVERNMENT. 22. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND GONE THROUGH THE RECORDS. THE LEARNED D.R HAS FILED THE INCENTIVE SCHEME AND THE ASSESSEE HAS ALSO FILED THE COPY OF THE ELIGIBILITY CERTIFICATE DATED 20.06.2003 ISSUED BY THE DISTT. INDUSTRIES CENTRE, LUDHIANA IN SUPPORT OF THE CLAIM. WE HAVE GONE THROUGH THESE DETAILS AND FIND THAT THE ASSESSEES MANUFACTURING UNIT WHICH WENT INTO PRODUCTION ON 01.03.2002, AND IN TERMS OF GOVERNMENT NOTIFICATION NO. INC.II/15/43/96- S/1B/4176 DATED 1.6.1996 IS ELIGIBLE FOR GRANT OF INCENTIVE OF SALES-TAX EXEMPTION FOR THE PERIOD OF SEVEN YEARS AND FOR THE MAXIMUM AMOUNT OF RS.12,45,30,000/- FROM 01.03.2002. EXACTLY THE SCHEME IS THE SAME AS WAS EXAMINED BY THE TRIBUNAL IN THE CASE OF M/S BHUSHAN STEELS & STRIPS LTD. (SUPRA). THE ORDER OF THE CIT(A) IS IN CONFORMITY WITH THE ORDER AND THE DECISION OF THE ITA NO.777/DEL/2011 8 INCOME-TAX APPELLATE TRIBUNAL IN THE CASE OF M/S BHUSHAN STEELS & STRIPS LTD. IN ITA NO.1113/DEL/2001 AND ALSO THE DECISION OF THE ITAT, SPECIAL BENCH IN THE CASE OF DY. CIT VS. RELIANCE INDUSTRIES LTD. 88 ITD 273 (MUM) (SB). THE ORDER OF THE CIT (A), IN OUR CONSIDERED OPINION, HAVING FOLLOWED THE BINDING DECISIONS OF THE TRIBUNAL, DOES NOT, THEREFORE, CALL FOR ANY INTERFERENCE. 4. AT THE TIME OF HEARING BEFORE US, THE LEARNED DR TRI ED TO DISTINGUISH THE DECISION OF ITAT ON THE GROUND THAT ON TH E FACTS OF THE ASSESSEES CASE, THE DECISION OF HONBLE APEX COU RT IN THE CASE OF SAHNEY STEEL AND PRESS WORKS LTD. AND OTHERS V S. COMMISSIONER OF INCOME TAX 228 ITR 253 WOULD BE A PPLICABLE. HE RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND STATED THAT SINCE THE SUBSIDY WAS GIVEN AFTER THE COMMENCEMENT OF PRODUCTION AS PER THE DECISION OF THE HONBLE APEX COU RT IN THE CASE OF SAHNEY STEEL AND PRESS WORKS LTD. AND OTHERS (SUPRA), THE SUBSIDY WAS IN THE NATURE OF REVENUE RECEIPT. HOW EVER, WE FIND THAT THE IDENTICAL ISSUE WAS CONSIDERED BY THE ITA T IN ASSESSEES OWN CASE IN THE EARLIER YEAR AND, IN THAT Y EAR ALSO, THE LEARNED DR HAS RELIED UPON THE DECISION OF HONBLE A PEX COURT IN THE CASE OF SAHNEY STEEL AND PRESS WORKS LTD. AND OTHE RS (SUPRA). THE ITAT, AFTER CONSIDERING THE ABOVE DECIS ION AND THE FACTS OF THE ASSESSEES CASE, HELD THAT THE SUBSIDY WAS NOT A REVENUE RECEIPT. SINCE THE FACTS OF THE YEAR UNDER CO NSIDERATION ARE IDENTICAL, RESPECTFULLY FOLLOWING THE ABOVE DECIS ION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2006-07, WE ALLOW GROUND NO.1 OF THE ASSESSEES APPEAL. 6. IN THIS VIEW OF THE SITUATION, RESPECTFULLY FOLLOWI NG THE AFOREMENTIONED DECISION OF THE TRIBUNAL IN THE CASE O F THE ASSESSEE FOR SUBSEQUENT ASSESSMENT YEAR AND FINDING NO MERIT IN THE D EPARTMENTAL APPEAL, THE SAME IS DISMISSED. 7. IN THE RESULT, THE APPEAL IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 11.05.20 12. SD/- SD/- [T.S. KAPOOR] [I.P. BANSAL] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED, 11.05.2012. ITA NO.777/DEL/2011 9 DK COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES