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2011 (1) TMI 1501 - AT - Income TaxDisallowance of deduction claimed u/s 43B - ''incentive'' sales tax remission - nature of receipt - the assessee claimed that the incentive in the form of sales tax remission as enjoyed by it under the West Bengal Incentive Scheme, 1999 was a capital receipt, not chargeable to Income Tax. the AO treated the said amount as revenue receipt only. He also stated that even otherwise the sales tax collected by the assesee has not been paid within the due date of filing of return and hence as per the provision of section 43B the amount needs to be added back to the income for the year. Hence, he dismissed the assessee’s contention and the amount of the deferred sales tax being the assistance received was added back to the income of the assessee. In appeal, the Ld. CIT(A) was of the opinion that the assistance given by way of sales tax remission is in the nature of capital receipt and accordingly, he directed the Assessing Officer to delete the addition. Aggrieved by the said order, now the revenue is in appeals. HELD THAT:- I am of the opinion that the assistance given by way of sales tax remission is in the nature of capital receipt. Accordingly, I direct the A.O. to delete the addition. In this view of the matter and in the absence of any contrary material brought on record by the revenue at the time of hearing before us, we do not find any infirmity in the order of the Ld. CIT(A) and the same is hereby upheld. Therefore, the appeals of revenue for all the years are dismissed.
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