TaxTMI 
TaxTMI 
2012 (12) TMI 725
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....g upon orders of Hon'ble High Court J & K, Jammu which has been delivered not on merits of the issue but holding the receipt to 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 indus....
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....d. first appellate authority has rightly treated the receipt of Central Excise Duty Refund and interest subsidy as a 'Capital Receipt' as against its treatment as 'Revenue receipt' by the A.O. In addition to that the issue has also been adjudicated and decided by the Hon'ble Jammu & Kashmir High Court in the case of Shree Balaji Alloys v. CIT and Another (2011) 333 ITR 335 (J&K) as well as by the Hon'ble Jurisdictional Court in the case of M/s. Mepco India Ltd. 2009 (7) Supreme 564 wherein it has been held as under: "For all what has been said above, the finding of the Tribunal on the first issue that the Excise Duty Refund, interest subsidy and insurance subsidy were production incentives, hence revenue receipt cannot be sustained, being ....
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....cise duty refund of RS.5,51,557/- as income derived from industrial undertaking. 5. After hearing both the parties, we are of the considered view that the issue raised by the assessee regarding excise duty refund is squarely covered by the decision of the Hon'ble Jammu & Kashmir High Court, in favour of the assessee, in the case of Shree Balaji Alloys v. CIT and Another (2011) 333 ITR 335 by holding that the Excise Duty refund is to be treated as 'capital receipt' in the hands of the assessee and not liable to be taxed. Respectfully following the above decision of the Hon'ble High Court of J & K, this ground of appeal of the assessee is allowed. 6. As regards ground No.3 relating to interest subsidy of Rs.28,66,092/-, we are of the....
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....Hon'ble Himachal Pradesh in case of M/s. Maharani Packing (P) Ltd. has also discussed the case aof CIT vs. Andaman Timber Industries 242 ITR 204 (Cal.) as under: "12. In CIT vs. Andaman Timber Industries Ltd..(2000) 158 CTR (Cal.), the assessee has claimed the benefit of S.80HH on profits qnd gains derived from the industrial undertaking and had included the amount paid to it under the transport subsidy scheme. The Calcutta High Court referred to the judgment of the apex court cited hereinabove and held that the transport subsidy is not derived from the activity of the industrial undertaking though it may be attributable to it and therefore, cannot be said to be treated as part of the profits and gains derived from the industrial undertaki....