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TMI Blog2016 (3) TMI 236X X X X Extracts X X X X X X X X Extracts X X X X ..... "1. That whether the commissioner of Income Tax (Apppeals), Jammu was right in law to allow deduction u/s 80IB of the Income Tax Act, 1961 on Central Excise Duty refund by relying upon the judgment of the Hon'ble High Court of J&K, in the case of M/s Shree Balaji Alloys & Others & ignoring the ratio of the law on the issue as laid down in the case of Ponni Sugar & Sawhney Steel and Press Works Ltd. 2. Whether the Commissioner of Income Tax(Appeals), Jammu Committed an error in law as laid down by the Hon'ble Supreme court in the case of Ponni Sugar & Sawhney Steel and Press Works Ltd. wherein similar receipts were held to be revenue in nature as the same had been made after the industries had been set up and not for purpose of setting up of the industries. 3. Whether in law, the Commissioner of Income Tax (Appeals), Jammu was right in not appreciating and applying the purpose test as laid down by the judgments of the Hon'ble Supreme Court, in the case of assessee, as the money received by the assessee on account of Central Excise was not supposed to be spent in a particular manner or for the purpose of substantial expansion of the industry. 2. At the time of hearing, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... schemes peculiar to those cases and those observations of the Hon'ble Supreme Court in those two cases were observations made and not law laid down as such. The Hon'ble Jurisdictional High Court observed that the Tribunal had not dealt with that part of the J & K Scheme, whereby unemployment in the state had been intended to be eradicated, creating an atmosphere for accelerated industrial development, to create employment opportunities to deal with the social problem of unemployment in the state. The Hon'ble Jurisdictional High Court held that this was a lop-sided interpretation of the new industrial policy and concessions formulated by the Central Government for the State of Jammu and Kashmir vide Office Memorandum of June 14, 2002. It was observed that the clear legal position adumberated by the Hon'ble Supreme Court of India on the issue in question is that to determine the nature and intent of the incentives, as to whether those were revenue receipts or capital receipts and the purpose underlying the incentives, was the determinative test. It was observed that the new industrial policy and other concessions for the State of Jammu and Kashmir had not been correctly a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the State, additionally creating opportunities for self employment, and hence, it was a purpose in the public sector. It was held that, therefore, the incentives provided to the industrial units in terms of the new industrial policy, of accelerated industrial development in the State for creation of such industrial atmosphere and environment, which would provide additional permanent source of employment to the unemployed in the State of Jammu and Kashmir were, in fact, in the nature of creation of new assets of industrial atmosphere and environment, having the potential of employment generation to achieve a social object. Such incentives, designed to achieve a public purpose, cannot, by any stretch of reasoning, be construed as production or operational incentives for the benefit of the assessee alone. 7. It was further held that looking to the purpose of eradication of the social problem of unemployment in the State, by acceleration of the industrial development and removing backwardness of the area that lagged behind in industrial development, which is certainly a purpose in the public interest, the incentives provided by the office memorandum and statutory notifications issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o and must follow Shree Balaji Alloys [supra] and this is what the ld. CIT(A) has, and in our considered opinion, correctly, done. Moreover no decision contrary to Shree Balaji Alloys [supra] has been successfully pleaded by the department before us, particularly in the face of the fact that not only the decisions in the cases of Sahney Steel and Press Works Ltd [supra] and Ponni Sugars and Chemicals Ltd [supra], but also that in the case of MEPCO [supra] has expressly been taken into consideration by the Hon'ble Jurisdictional High Court in the case of Shree Balaji Alloys [supra]. It does not lie in the mouth of the department to raise as a grievance, the ground of appeal to the effect that the ld. CIT(A) erred in following the decision in the case of Shree Balaji Alloys [supra] rendered by the Hon'ble Jurisdictional High Court. 10. The above said, if we are permitted to say so in the higher wisdom of their Lordships of the Hon'ble Jurisdictional High Court, it may also be registered that it has nowhere been the case of the department that the finding of the Hon'ble Jurisdictional High Court in Shree Balaji Alloys [supra] to the effect that the generation of emplo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment. 13. In the result, the appeal filed by the department in ITA No.398(Asr)/2015 is dismissed. 14. In all the other appeals, i.e., ITA 319 & 395(Asr)/2015, 472 & 473(Asr)/2015, 267(Asr)/2015, 396(Asr)/2015, 321(Asr)/2015, 296(Asr)/2015, 320(Asr)/2015 and 397(Asr)/2015, the facts and circumstances being exactly similar to those in the case of M/s Singla Cables, in ITA No.398(Asr)/2015 and, therefore, our findings in ITA No.398(Asr)/2015 will apply, mutatis mutandis, to these appeals also. Accordingly, all these appeals filed by the department stand dismissed. 15. In ITA nos.472 & 473(Asr)/2015, in the case of M/s. J.K. Petrochemicals, though the notice sent to the assessee has been received back undelivered, finding that the matter can be decided in the absence of the assessee, we have decided the matter on merit, as above. Thus, both the appeals of the Revenue are dismissed. 16. In ITA No.321(Asr)/2015, in the case of M/s. Pee Ell Alloys, Jammu, the notice has been served upon the assessee. Despite this, nobody attended the hearing on behalf of the assessee. However, we have decided the issue on merit, as above. Thus, the appeal of the revenue is dismissed. 17. As regards ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of Smt. Arun Luthra (supra) and Kil Kotagiri Tea and Coffee Estates Ltd. (supra), we are of the view that there is a mistake apparent from record which is rectifiable u/s 154 of the Act and the Ld. CIT(A) has rightly directed the AO to carry out the necessary rectification and the order of the Ld. CIT(A) is found to be well reasoned one and we find no infirmity in the same. 18.2. Therefore, respectfully following the order of the Tribunal dated 16.01.2015 (supra) in the assessee's own case, this ground of the revenue is dismissed. In the result, the appeal of the Revenue in ITA No.237(Asr)/2015 is dismissed. 19. As regards the C.Os raised by different assessees, bearing nos.23(Asr)/2015, 17(Asr)/2015 and 20 & 21(Asr)/2015, the same are supportive to the orders of the ld. CIT(A) and the assessees, in fact, do not have any grievance in the said C.Os. Accordingly, the same are dismissed. 20. In the result, all the appeals of the department in ITA nos.398(Asr)/2015, 237(Asr)/2015, 319 & 395(Asr)/2015, 472 & 473(Asr)/2015, 267(Asr)/2015, 396(Asr)/2015, 321(Asr)/2015, 296(Asr)/2015, 320(Asr)/2015, and 397(Asr)/2015, as well as the cross objection nos. 23(Asr)/2015, 17(Asr)/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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