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TMI Blog2015 (10) TMI 2764X X X X Extracts X X X X X X X X Extracts X X X X ..... t assessees and Department are directed against the separate orders of the learned Commissioner of Income Tax (Appeals), relating to assessment years 2001-02, 2003-04, 2004-05, 2006-07, 2007-08 and 2010-11. In all the appeals, the issue is common and, therefore, these appeals were heard together and are being disposed off by this common order for the sake of convenience. 2. Since the facts and circumstances are identical in all the appeals, we may refer to the discussion in the orders of the Income Tax Authorities in the case of Vardhman Acrylics Limited in ITA No.773/Chd/2012. This appeal filed by the assessee is directed against the order of learned Commissioner of Income Tax (Appeals)-II, Ludhiana dated 28.5.2012. 3. The brief facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Government of Gujarat as sales tax Subsidy is capital or revenue in nature. The learned counsel for the assessee at the very outset mentioned that these were a bunch of appeals before the Hon'ble Punjab & Haryana High Court together with the appeal of the assessee, out of which there was a case of Bhushan Limited, which was also similarly restored to the file of the Tribunal to decide the same afresh. The order of the Chandigarh Bench of the I.T.A.T. in the case of Bhushan Limited in ITA No.744/Chd/2006 & Others dated 16.6.2015 has been delivered, whereby after deliberating the issue on the nature of sales tax subsidy, the same has been held to be revenue in nature. 6. The learned D.R. did not controvert the said submissions made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scheme mainly the criteria has been laid down with regard to the fixed capital investment, project related infrastructural investment, social infrastructural investment and common and public purpose infrastructure. All these requirements are towards capital investments. Further a closer look at the clause relating to ineligible investment shows that short term investment or investment of revenue nature are not eligible for this scheme. A certificate of being declared as Permanent Prestigious Unit has been given to the assessee dated 18.5.2002, whereby the details of investment of the project and employment are given. We have also gone through the scheme of the Bengal Government which was in question before the Chandigarh Bench of the I.T.A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear that the unit of assessee was set up as per scheme formulated by Government of West Bengal and assessee has been allowed remission of sales tax for 12 years upto 100% of gross fixed capital investment/asset of the approved project. The incentive scheme was available for location of the unit. No incentive is available to units located in group 'A'. The unit of assessee is located in group 'B' (Hooghly). The subsidy would help the growth of industry and not to supplement profit. Subsidy is determined with reference to the fixed capital investment/asset and not profit. No working capital is considered in the scheme. The ld. DR says that the subsidy is given for 12 years after production and as such it is revenue in nature. The arguments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bengal. 26. Considering the facts and circumstances of the case in the light of decision of the Hon'ble Supreme Court in the case of Ponni Sugars & Chemicals Ltd. (supra) and considering the above discussion, we are of the view that sales tax subsidy received by the assessee is capital receipt in nature and are not subjected to tax. The additions made by the Assessing Officer on account of receipt of sales tax subsidy are accordingly deleted in all the assessment years in appeals. The issue remanded to the Tribunal is thus, decided in favour of the assessee and against the revenue in all the appeals under reference." 8. Respectfully following the order of the Coordinate Bench of the Tribunal, we hereby hold that the sales tax subs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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