TaxTMI 
TaxTMI 
2014 (1) TMI 1444
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....reams, ointments and lotions. For the year under consideration the return was filed on 24.11.2006 declaring total income at Rs.2,17,82,605/- The return was selected for scrutiny assessment and accordingly statutory notices were issued and served upon the assessee. During the course of scrutiny assessment the Assessing Officer noticed that the assessee has added a sum of Rs.49,81,640/- credited to the capital reserve account representing the adjustment in the sales tax deferment loan from Government of Madhya Pradesh on prepayment of loan installments falling due in the financial years 2007-08 and 2008-09. It was explained that the assessee had availed of sales tax deferment loan of Madhya Pradesh Government in accordance with the scheme of ....
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.... counsel for the assessee strongly submitted that the revenue authorities have failed to appreciate the facts in their right perspective. It is the say of the counsel that the Assessing Officer himself has admitted in the assessment order that the sales tax liability was converted into loan as per the state government scheme. The counsel further argued that as per the Board Circular dated 29.12.1993, such sales tax liability was allowed as deduction in the earlier years. The counsel further submitted that this issue is clearly covered by the decision of the Special Bench of the Tribunal in the case of Sulzer India Ltd. 19 ITR (TRIB) 268 (Mum). The DR strongly supported the findings of the Assessing Officer and relied upon the decision of ju....
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....h were deferred under the scheme, and the amounts were payable after twelve years in six equal annual instalments commencing from 1-5-2003, which meant that the liability was payable in future. Later on, the State Government came out with a scheme by which it was provided that if some dealers opted, then they could pay the future liability at a discounted value or what one may call net present value immediately. Thus, in this situation, it could not be construed as remission of liability, because the State Government had not waived of any of the liability as given in the illustrations. Had the State Government accepted lesser amount after twelve years or reduced such instalments, then it could have been a case of remission or cessation. How....
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....issue in the case of M/s. Godrej & Boyce Mfg. Co. Ltd. in ITA No. 6867/Mum/2011 for AY 2005-06, in which we have followed the aforesaid decision of the Tribunal in the case of Sulzer India Ltd. Facts and issues being identical, respectfully following the decision of the Special Bench and our own decision [supra], we have no hesitation in reversing the findings of the CIT(A) and accordingly, ground no.1 with its sub grounds are allowed. 5. Before parting, the DR has relied upon the decision of Jurisdictional High Court of Bombay in the case of Hindustan Foods Ltd 328 ITR 392. However we find that in that case the assessee company unilaterally transferred the unclaimed amount of the debenture redemptions to its general reserve without comply....