https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=433070 https://www.taxtmi.com/caselaws?id=433070 Characterisation of receipts - sales tax subsidy - capital receipt - CIT-A concluded subsidies received pertaining to development of industries is of the nature of capital receipt - HELD THAT:- CIT(A) has considered the decision of Ponni Sugar Chemicals Ltd. [ 2008 (9) TMI 14 - SUPREME COURT ] wherein held that if the purpose of incentive or subsidy was to enable the assessee to set up a new unit or to expand the existing unit then the receipt of subsidy was of the capital in nature. The ld. CIT(A) has also discussed the other decision of ITAT, Chennai in the case of Eastman Export Global Clothing Pvt. Ltd. [ 2016 (7) TMI 951 - ITAT CHENNAI ] wherein it is held that if the object of assistance was to enable the assessee to set up a new unit or expand the existing unit then the receipt is of the capital account. Similarly the ld. CIT(A) has also discussed the various other decision in his finding on identical issue that subsidies received pertaining to development of industries is of the nature of capital receipt. During the course of appellate proceedings before us the ld. counsel also submitted that in subsequent year assessment year 2013-14 the ld. CIT(A) has allowed the appeal of the assessee treating sale tax subsidy as capital receipt and department has not raised any ground before the ITAT. It is also submitted that in assessment year 2015-16 the assessee has treated the sale tax subsidy received as capital receipt and same has been accepted by the A.O in the assessment order. In the light of the above facts and finding we don t find any force in the ground of appeal of the revenue, therefore, this ground of appeal stand dismissed. Claim of education cess as deduction - HELD THAT:- Since surcharge or cess is a part of Income Tax and not deductible u/s 40(a)(ii) w.e.f 01.04.2005 as per Finance Act 2022. Therefore, we consider that assessee is not eligible for claiming deduction of education cess while computing total income. Therefore, this ground of appeal of the revenue is allowed. TDS u/s 195 - non deduction of TDS on payment to non-resident to ICIC prising U.K. and to Platts USA - Disallowance u/s 40(a)(i) - HELD THAT:- During the course of appellate proceedings before us the ld. Counsel could not controvert the fact that impugned payment made to the non-resident was not attracted by the provision of Sec. 195 of the Act, therefore, we don t find any merit in this ground of appeal of the assessee, therefore, the same stand dismissed. Claim of deduction u/s 80IA on account of generation of power - HELD THAT:- The assessee claimed that it has coal based boiler which generate powers in the form of steam. It was also submitted for power in the form of steam was generated by the captive power plant and consumed in the manufacturing of chemicals. The assessee claimed that deduction u/s 80IA on the said unit was allowed by the A.O in the subsequent assessment year 2016-17. Since, this issue of claim of deduction u/s 80IA was not made before the lower authorities, therefore, we restore this issue to the file of the assessing officer for deciding de novo after verification of the relevant details and material to be submitted by the assessee during the course of set aside proceedings. Therefore, this ground of appeal of the assessee is allowed for statistical purposes. Case-Laws Income Tax Wed, 30 Nov 2022 00:00:00 +0530