TaxTMI 
TaxTMI 
2021 (6) TMI 620
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....ent year 2013-14, the assessee received an excise subsidy amounting to Rs. 14,55,88,357/-. The assessee filed their return of income for the assessment year 2013-14 on 30.11.2013 declaring the taxable income of Rs. 10,08,580/- where under the assessee had offered the excise subsidy of Rs. 14,55,88,357/- also. Subsequently, in view of the decisions of Hon'ble Supreme Court in the case of Poni Sugars & Chemicals Ltd. (2008) 306 ITR 392 (SC) and Shree Balaji Alloys vs. CIT, 287 CTR 459, the Excise Subsidy has to be characterized as capital receipt under the "New Industrial Policy and Other Concessions Scheme" dated 14.06.2002 in the State of Jammu & Kashmir and therefore, during the course of assessment proceedings, the assessee filed a letter dated 01.02.2016 and made certain submissions in that respect on 28.11.2016, praying for the admission of the claim of assessee to treat the Excise Refund as Capital Receipts and non-taxable. 3. The Assessing Officer, however, recorded that in view of the provisions of section 139(5) of the Income-tax Act ("the Act"), in the absence of any revised return, no claim of assessee could be considered by way of a simple letter. The Assessing Off....
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....pute. Hence, we admit the additional ground for adjudication. 7. It could be seen from the orders of the authorities below that both the authorities below felt helpless to consider the claim of assessee preferred by way of a letter in the absence of any revised return in view of the decision of Hon'ble Supreme Court in the case of Goetze (India)(supra). Observations of Hon'ble Supreme Court are extracted by the CIT(A) in his order and they clearly exclude the Income-tax Appellate Tribunal from the bar to consider the claim of assessee in the absence of revised return, u/s. 254 of the Act. It is, therefore, clear that the duty of the authorities under the Act is to determine the just tax liability of the assessee without being deterred by any technicalities and in view of the decision of Hon'ble Supreme Court in Goetze (India), the Tribunal is free to consider such claims u/s. 254 of the Act. Learned AR of the assessee has also placed strong reliance on the decision of coordinate Bench of this Tribunal in the case of M/s. Crystal Crop Protection (P) Ltd. vs. DCIT dated 19.12.2019 (ITA No. 1539/Del/2016), wherein the identical claims of assessee stood allowed by the Tribunal. ....
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....pex Court has also held that if the Appellate Assistant Commissioner is satisfied he would be acting within his jurisdiction in considering the question so raised in all its aspects. Of course, while permitting the assessee to raise an additional ground, the Appellate Assistant Commissioner should exercise his discretion in accordance with law and reason. He must be satisfied that the ground raised was bona fide and that the same could not have been raised earlier for good reasons. The satisfaction of the Appellate Assistant Commissioner depends upon the facts and circumstances of each case and no rigid principles or any hard and fast rules can be laid down for this purpose. 11. The similar proposition has reiterated by the Hon'ble Apex Court while dealing with the similar issue in the case National Thermal Power Co. Ltd. Vs CIT 229 ITR 383. The Apex Court reiterated that "6. In the case of Jute Corporation of India Ltd. v. C.I.T. this Court, while dealing with the powers of the Appellate Assistant Commissioner observed that an appellate authority has all the powers which the original authority may have in deciding the question before it subject to the restrictions or limi....
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....assessee has suo-moto offered the amounts to taxation already. For determination of the issue whether the Assessing Officer or the Tribunal empowered to consider the plea of the assessee, the provisions of the Act are examined. 14. Year-1989 -- The provision sub-section (3) was substituted by the following provision by the Direct Tax Laws (Amendment) Act, 1987 with effect from 1st April 1989, which read as follows "(3) On the day specified in the notice issued under sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him on the basis of such assessment." 15. On perusal of the above provision, it is noted the Legislature specifically excluded the A.O.'s power to determine sum 'refundable' to the assessee on completion of assessment under sub-section (3) of Section 143 of the Act. The intent....
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....Gurjargravures Private Ltd. and Goetze (India) Ltd. In the former a claim for exemption was for the first time put up before the Appellate Assistant Commissioner who rejected the claim as not made before the I.T.O. This rejection was set aside by the Tribunal with direction upon the Appellate Assistant Commissioner to entertain the question of relief under section 84, claimed by the assessee in that case. The Supreme Court held that it was not competent for the Tribunal to have done so. The distinction between the two authorities eliminating any conflict is that in Gurjargravures Private Ltd. the competence of the Tribunal to direct the Appellate Assistant Commissioner to entertain a claim not made before the I.T.O was found to be lacking. In Goetze (India) Ltd. the Supreme Court held that the assessing Authority's power was limited but not that of the Tribunal in the context of dealing with a claim of the assessee therein not put forward before the Assessing Officer. In Gurjargravures Private Ltd. (supra) the Tribunal itself did not consider to allow the claim for relief. 20. Further, the CBDT Circular No. 14(XL-35 dated 11.04.1955) wherein it is held as under: ....
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....lished industry and not to set up a new one, (ii) it was available after commercial production, (iii) it was recurring in nature, (iv) it was not for purchasing capital assets and (v) it was for running the business profitably. On appeal by the assessee, the High Court (333 ITR 335) reversed the lower authorities and held as follows: (i) The ratio of Sahney Steel 228 ITR 253 (SC), Ponni Sugars 306 ITR 392 (SC) and Mepco Industries 319 ITR 208 (SC) is that to determine whether incentives & subsidies are revenue or capital receipts, the purpose underlying the incentives is the determinative test. If the object of the subsidy scheme is to enable the assessee to run the business more profitably then the receipt is on revenue account. On the other hand, if the object of the subsidy scheme is to enable the assessee to set up a new unit or to expand the existing unit then the receipt of the subsidy was on capital account. It is the object for which the subsidy/assistance is given which determines the nature of the incentive subsidy. The form or the mechanism through which the subsidy is given is irrelevant; ii) On facts, the object of the subsidy scheme was (a) to accele....