TMI Blog2017 (3) TMI 951X X X X Extracts X X X X X X X X Extracts X X X X ..... om other sources. The facts of the case before us are that the impugned amount was received back by the assessee from banks under the scheme of Ministry of Textile in respect of reimbursement out of the actual interest first paid to the assessee to the banks. These facts have not been disputed by the Ld. DR before us. Under these circumstances, we find that judgment of Hon'ble Supreme Court in the case of Meghalaya Steels Ltd. (supra) squarely covers the issues involved. Thus, we find no need for making interference in the order passed by Ld. CIT(A) wherein claim made by the assessee was allowed by Ld. CIT(A) - Decided against revenue - ITA No.1684/Mum/2014 - - - Dated:- 16-3-2017 - Shri Mahavir Singh, Judicial Member, and Shri Ashwa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No 4287/Mum/2010 dt.23-12-11), on the subject. The appellant prays that the order of the CIT(A) on the above ground be set aside and that of the 1TO/AC/DCIT be restored. The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary. The appellant prays that the order of the CIT(A) on the above ground be set aside and that of the 1TO/AC/DCIT be restored. 2. During the course of hearing, It was submitted at the outset, by the Ld. Counsel of assessee that solitary issue involved in this appeal is with regard to allowability of deduction u/s 80IC on the amount of interest subsidy received by assessee during the year, in pursuance to scheme of the Government. It was submitted that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y bring the part reimbursement made by Ministry of Textile of India, of the interest paid by the assessee to the Banks. As per the scheme of the Ministry of Textile, Government of India, the Assessee Company is entitled to receive part re-imbursement of the interest paid to the banks on loans availed and used for the purpose of business activities carried on by the Assessee. The said amount merely for the purposes of accounting control was accounted for separately by the Assessee company and accordingly shown to the credit of profit loss account under the head; which in fact is the part reimbursement of expenses incurred by the Assessee on account of interest paid to the Banks and not in the nature of any income earned by the Assessee. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... link and first degree nexus with the expenses of Industrial Undertaking and has effect of reducing the operational cost of the Undertaking. The Assessee has, merely for the control purpose, shown the said interest reimbursement separately in credit side of the Profit Loss Account. I had the Assessee adopted the alternative method of accounting, whereby the reimbursement of expenses are credited to/reduced from the particular expenses head, there would have been no' surplus/credit balance under any accounting head. It was further, submitted that the said method of accounting is recognized metld4 as per the Accounting Standard 12 issued' by the Institute of Chartered Accountants wherein It is categorically, provided that any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considered all earlier judgments and given the finality on the issue involved. It was, therefore, submitted that the amount of interest.- reimbursement amounting to ₹ 1,34,45,475/- should not be excluded while amounting deduction u/s 80-IC and the same. be. allowed to the Assessee in full . 7. Ld. CIT(A) considered the submissions of the assessee and found that this issue was covered in favour of the assessee in view of the judgments of Hon'ble Gauhati High Court in the case of CIT Vs. Meghalaya Steels Vs. and Pride Coke Pvt. Ltd. 356 ITR 235 (Gauhati), and thus he allowed the claim of the assessee. 8. During the course of hearing before us, it has been brought to our notice that judgment in the case of Meghalaya Steels ..... X X X X Extracts X X X X X X X X Extracts X X X X
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