2012 (11) TMI 104

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....delivered not on merits of the issue but holding the receipt to be a capital receipt only because the policy under which the same was paid envisaged tackling the unemployment in the State which cannot be said to be a good test for deciding whether a receipt is a trading receipt or a capital receipt. 2. On the facts and circumstances whether the Ld. CIT(A) was right in facts and circumstances and in law in not appreciating the judgments of Hon'ble Supreme Court of India in the case of Ponni Sugar & Sawhney Steel and press works Ltd, wherein the Hon'ble Supreme Court had held such receipts to be the revenue receipts in as much as in that case payments were made only after the industries had been set up and payments were not made for purpos....

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.... section 80IB on Excise Duty Refund & Interest subsidy, it is an admitted fact that the issue in dispute has already been adjudicated and decided in favour of the assessee by the decision of the Hon'ble Jurisdictional High Court of Jammu & Kashmir in the case of Shree Balaji Alloys v. CIT and Another reported in (2011) 333 ITR 335 (J&K) by holding that the Excise Duty refund and interest subsidy is to be treated as 'Capital receipt' and not liable to be taxed. 2.1. The Ld. first appellate authority has also decided this issue in favour of the assessee by relying upon the decision of the Hon'ble Jurisdictional High Court of J & K, in the case of Shree Balaji Alloys v. CIT and Another (2011) 333 ITR 335 (J&K). Therefore, respectfully follo....

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....nal and the appeal of the department may be dismissed. 2. Again, the ld. CIT(A) has grossly erred in confirming the order of the Assessing Officer wherein a disallowance of Rs.351417/- has been made u/s 36(1)(iii) of the Income-tax Act, 1961. The authorities below did not appreciate that no disallowance was called for and the disallowance made is unjustified, uncalled for and addition of Rs.351417/- may be deleted."   6. The first ground relates to deduction under section 80IB of the Act on account of Excise Duty Refund and Interest Subsidy, which the ld. CIT(A) has decided by relying upon the decision of the Hon'ble High Court of Jammu & Kashmir in the case of M/s. Shree Balaji Alloys vs. CIT and Another (2011) 333 ITR 335 (J&K)....