TMI Blog2012 (12) TMI 725X X X X Extracts X X X X X X X X Extracts X X X X ..... be treated as part of the profits and gains derived from the industrial undertaking - no deduction is available u/s 80IB on the amount of freight subsidy - order of A.O. is affirmed/confirmed. Treating interest as income derived from industrial undertaking - Held that: - Following the decision of in case of M/s. Pandian Chemicals [2003 (4) TMI 3 - SUPREME COURT] interest cannot be treated as income derived from industrial undertaking for the purpose of computation of deduction u/s 80IB – ground of assessee is dismissed. - I.T.A. No. 580 & 625(Asr)/2011 - - - Dated:- 2-7-2012 - SH. H.S. SIDHU AND SH. B.P.JAIN, JJ. Department by:Sh. Tarsem Lal, DR Assessee by: Sh. P.K. Mishra, CA ORDER PER BENCH ; The R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apital receipt. 4. On the facts and circumstances whether the Ld. CIT(A) was right in facts and circumstances and in law in not appreciating and applied the purpose test as laid down by the judgments of the Hon'ble Supreme Court. In the case of assessee, the money received by the assessee on account of refund of Central Excise was not supposed to be spent in a particular manner for purpose of substantial expansion of the industry. 5. Even though the tax effect involved in this case is below Rs. 3 lacs the appeal is filed in view of the decision of the Hon ble Supreme Court in the case of CIT, Central-III, Surya Harbal Ltd. vide CC No.13694/2011 dated 29.08.2011 in which the Hon ble Supreme Court has held that the Circular dated 09.02.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. That the order of the ld. CIT(A) is bad in law and on the facts of the case. 2. That the ld. CIT(A) has erred in upholding the action of the AO in not treating excise duty refund of Rs.5,51,557/- as income derived from industrial undertaking and accordingly not including the same for the purposes of calculation of profit for computing deduction u/s 80IB of the Act. 3. That the ld. CIT(A) has erred in upholding the action of the AO in not treating transport subsidy of Rs.28,66,092/- as income derived from industrial undertaking and accordingly not including the same for the purposes of calculation of profit for computing deduction u/s 80IB of the Act. 4. That the ld. CIT(A) has erred in upholding the action of the AO in not treating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nouncements by the Hon ble High Court of Himachal Pradesh in case of M/s/. Kiran Enterprises 32 DTR 11/228 CTR 101 on the issue of treatment of transport subsidy for the purposes of deduction u/s 80IB of the I.T.Act. Thus, the case law cited by assessee is of no more of relevant being over ruled. I also have before me another recent decision of Hon ble Himachal Pradesh High Court in case of M/s. Maharani Packaging (P) Ltd. reported at 55DTR 340 directed on the issue of freight subsidy. Both the decisions are directly on this issue and in those decisions the elaborate discussions are made of the judgments of Hon ble Supreme Court in M/s. Cambay Electric Supply Industrial Co. 113 ITR 84 (SC) and Sterling Foods 273-ITR-579 (SC) and M/s. Libert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applied to the facts of the case. In view of the above respectfully following the judgments of Hon ble Himachal Pradesh as referred above in the view of the fact that no contrary judgment is available before me, I hold that no deduction u/s 80IB of the Act is available to assessee on the amount of freight subsidy received. The order of A.O. is affirmed/confirmed. 6.1. After going through the impugned order, we are of the view that the ld. first appellate authority has rightly disallowed the claim of transport subsidy in dispute on the basis of the decision of Hon ble High Court of Himachal Pradesh in various decisions mentioned in the aforesaid paragraph. Therefore, no interference is called for the in the order of the ld. first appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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