TMI Blog2023 (2) TMI 197X X X X Extracts X X X X X X X X Extracts X X X X ..... n our opinion, the foundation u/s. 143(3) r.w.s. 263 was order u/s. 263 of the Act, which has already been demolished, then the consequent order passed cannot survive. No infirmity in the finding of the Ld. CIT(A) on the issue-in-dispute. Accordingly, the grounds raised by the Revenue are dismissed. - ITA No. 1422/MUM/2020 ITA No. 1429/MUM/2020 - - - Dated:- 20-1-2023 - SHRI ABY T VARKEY (JUDICIAL MEMBER) And SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) For the Assessee : Mr. Yogesh Thar/Shri Chaitanya Joshi, AR For the Revenue : Ms. Richa Gulati, DR Mr. Ashok Singh, CIT-DR ORDER Per Om Prakash Kant, AM These two appeals by the Revenue are directed against two separate orders, both dated 03.12.2019, passed by the Ld. Commissioner of Income-tax (Appeals)-1, Thane [in short 'the Ld. CIT(A)'] for assessment year 2008-09 and 2010-11 respectively. Being identical issue involved in both these appeals, same were heard together and disposed off by way of this consolidated order for convenience and avoid repetition of facts. 2. We take up the appeal of the Revenue for assessment year 2008-09. The grounds raised by the Revenue are reproduced as under: 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive, 1993. The AO passed order u/s. 143(3) r.w.s. 254, in the A.Y. 2008-09, holding the sales tax incentives as revenue in nature and held that, In ITAT the issue of sales tax incentive of Rs. 5,37,44,724/- claimed as capital receipt was set aside to the file of the A0 for fresh adjudication with a direction 10 compare the sales tax incentive scheme of 1979 availed by Reliance Industries Limited and the New Package Scheme of Incentive 1993 which is availed by the assessee. However, the issue of sales tax incentive claimed as capital receipt, allowed by the Hon'ble ITAT in the case of Reliance Industries Limited, has been sent back to the Hon'ble Bombay High Court by the Hon'ble Supreme Court with a direction to decide whether sales tax incentive is a capital receipt or not. Accordingly, the issue has not yet 113th attained finality. The case of the assessee for AY. 2003-04 has been clubbed with the appeal pending in the case of Reliance Industries in the Hon'ble Bombay High Court. Accordingly, since the Income Tax Department has not accepted the view of the Tribunal both in case of Reliance Industries and the assessee and filed further appeals before the Hon&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omparison between the two schemes has already been made by the Hon'ble ITAT in assessee's own case for AY 2003-04 in its order dated 04.12.2009 and held that both the schemes are similar and identical. Accordingly, by placing reliance on the ITAT Order for AY 2003-04, it is held that both the schemes are similar and identical. 3.3 However, the issue of sales tax incentive claimed as capital receipt, allowed by the Hon'ble ITAT in the case of Reliance Industries Limited, has been sent back to the Hon'ble Bombay High Court by the Hon'ble Supreme Court with a direction to decide whether sales tax incentive is a capital receipt or not. Accordingly, the issue has not yet attained finality. The case of the assessee for AY 2003-04 has been clubbed with the appeal pending in case of Reliance Industries in the Hon'ble Bombay High Court. Accordingly since the Income Tax Department has not accepted the view of the Tribunal both in case of Reliance Industries and the assessee and filed further appeals before the Hon'ble High Court, the contention of the assessee to claim sales tax incentive as capital receipt is not tenable and hence disallowed . 6.5 It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee company availed the said incentives/subsidy on account of sales tax aggregating to Rs. 6,74,12,461/-. In the return of income the assessee company excluded the above subsidy on account of sales tax incentive in computing the total income under normal provisions of the Act. The assessee took this said exclusion as capital receipt, however, the Revenue treated this amount as revenue receipt and added back to the total income of the assessee company. 4.2. Thereafter, the Tribunal (supra) directed to delete the addition treating the sales tax incentive as capital receipt. The relevant finding of the Tribunal is reproduced as under: 12. We have heard the submissions of both the parties and perused the material available on record. We find that the present issue is fully covered in assessee's own case in ITA. No. 814/Mum/2007 for the A.Y. 2003-04 wherein the Tribunal allowed relief in respect of the matter in issue. Further, the Special Bench of the Tribunal in the case of DCIT vs., Reliance Industries Ltd., [2004] 88 ITD 273 (Mum) held that sales tax subsidy received under the Package Scheme of Incentives, 1979 is for the purpose of industrial development of the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fic grounds of appeal on merits? 6. The issue-in-dispute in the grounds raised is that Revenue seeks to agitate the dismissal of assessment order u/s. 143 consequent to order u/s. 263, of the Act as the order u/s. 263 has been quashed by the ITAT. In our opinion, the foundation u/s. 143(3) r.w.s. 263 was order u/s. 263 of the Act, which has already been demolished, then the consequent order passed cannot survive. The relevant finding of the Ld. CIT(A) on the issue-in-dispute is reproduced as under: 5. DECISION During the appellate proceedings, the appellant filed written submission inter-alia, stating as under: 2.0 Further, it is submitted that the appellant had also filed an appeal before the Hon'ble Mumbai ITAT against order us 263 dated 25-11-2013, bearing ITA No. 532/Mum/2014. In the said appeal, the appellant was of the view that since the AO has made requisite enquires during the course of assessment proceedings and thereafter disallowed the claim, the order passed by the AO cannot be treated as erroneous and prejudicial to the interest of revenue. The case was extensively presented on facts, legal principles and also judicial supports and several s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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