TMI Blog2014 (1) TMI 1766X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Revenue is against the order of the Commissioner of Income-tax (Appeals), Chandigarh dated 04.06.2013 relating to assessment year 2010-11 against the order passed under section 143(3) of the Income Tax Act, 1961 (in short the Act ). 2. The grounds of appeal raised by the Revenue read as under: On the facts and circumstances of the case and in law, the Ld. CIT(Appeals) in Appeal No. 536/12-13, has erred in deleting the following additions:- 1 On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in holding that excise duty refund was a capital receipts and was not to be included as income in the hands of the assessee. 2 On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue in relation to excise duty refund and in turn following the ratio laid down by the Hon'ble Jammu Kashmir High Court in M/s Shree Balaji Alloys Others Vs. CIT in ITA No.2 of 2010 and Others (date of decision 31.1.2011), held that the said excise duty refund was capital receipt in the hands of the assessee and did not address the issue of whether the excise duty refund was derived from the manufacturing activities carried on by the assessee and in turn being eligible for deduction under section 80IB of the Act. The relevant findings of the Tribunal are vide paras 15 to 18 which are as under: 15. We have heard the rival contentions and perused the record. The issue raised vide ground No.3 by the assessee was in connection wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unch of appeals with lead order in M/s Shree Balaji Alloys Others Vs. CIT in ITA No.2 of 2010 Others. The Hon'ble Court vide order dated 31.1.2011 after considering the scheme formulated by the State Government had also referred to the ratios laid down by the Hon'ble Supreme Court in Sawhney Steel Press Works Ltd. Others Vs. CIT [228 ITR 253(SC)] and CIT Vs. Ponni Sugars Chemicals Ltd. [306 ITR 392 (SC)] and held that in context of the respective incentive schemes in the two cases, the subsidy in Sawhney Steel Press Works Ltd. Others (supra) was held to be revenue receipt whereas the subsidy in Ponni Sugars Chemicals Ltd.(supra) was held to be capital receipt. Further support was taken from the later decision of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alaji Alloys Others (supra). Following the above said ratio laid down by the Hon'ble Jammu Kashmir High Court, we hold that the excise duty refund of ₹ 139.80 lacs was capital receipt in the hands of the assessee and was not to be included as income of the assessee during the year under consideration. In view thereof, we allow additional ground of appeal No.1. raised by the assessee. 18. As we have held the said receipts to be capital in nature and hence outside the purview of tax, we are not addressing the issue raised vide ground No.3 by the assessee as to whether the said excise duty refund is derived from the manufacturing activities carried on by the assessee and hence eligible for deduction under section 80IB of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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