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2019 (6) TMI 1657 - HC - Income TaxAddition on account of excess depreciation claimed - HELD THAT:- we notice that similar issue had come up for consideration before this Court in Revenue’s Income Tax Appeal in case of this very assessee for earlier assessment year. While disposing of the appeal by an order [2017 (4) TMI 1576 - BOMBAY HIGH COURT] the Court recorded that the learned counsel for the Revenue haS instructions not to press this ground. This question is, therefore, not considered. Capital subsidy received as excise duty reimbursement - Revenue or capital receipt - HELD THAT:- Subsidy scheme formulated by the Government of Bihar was for the purpose of attracting capital investment and to encourage setting up / expansion of existing units. Thus the object / purposes of the subsidy was for the purposes of encouraging capital investments in the State of Bihar. Consequently the impugned order holds that subsidy would be on Capital account and could not be considered to be on Revenue account. In fact this issue about the object/purpose of the subsidy deciding its character as revenue or capital is no longer res integra in view of the decision of the Supreme Court in CIT, Madras v/s. Ponni Sugars & Chemicals Ltd. [2008 (9) TMI 14 - SUPREME COURT] Addition made to the book profit on account of excess depreciation and subsidy received by way of reimbursement of commercial tax (VAT) - HELD THAT:- the question as proposed also seeks addition to book profits on account of excess depreciation along with subsidy received by the respondent - assessee. It is settled position in law as held by the Apex Court in Apollo Tyres Ltd. v/s. CIT [2002 (5) TMI 5 - SUPREME COURT] that the Assessing Officer while computing the book profit under Section 115J of the Act has only a power to examine whether the books of account have been maintained in accordance with the provisions of the Companies Act and have been duly audited. The book profits as reflected in the duly audited account have to be accepted by the Assessing Officer and the only limited power he has to increase/ decrease the book profit as arrived at by the assessee is only in terms of the Explanation to Section 115J of the Act. In the present case, the Revenue is not invoking the explanation to Section 115J of the Act to vary the book profit declared in the audited accounts of the respondent - assessee.
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