2023 (6) TMI 881

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.... by the ACIT, Circle-1(1)(2), Baroda under section 143(3) of the Income Tax Act, 1961 (hereinafter referred as to 'the Act') for Assessment Year 2012-13. 2. The following ground of appeal raised by Revenue has left to be adjudicated by the Co-ordinate Bench while disposing of the appeal on 28.09.2021. "1. On the facts and in the circumstances of the case and in law, the Ld. CIT(Appeals) erred in treating entertainment tax exemption in respect of Multiplexes of 9,89,90,747/-as capital receipt, not eligible to tax, without appreciating that the subsidy received by the assessee was after completion of the cinema house and commencement of operation and used entirely for the business operation, and therefore, revenue in nature." 3....

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.... not eligible to tax. Before the Ld. AO, the assessee submitted that the details regarding the treatment of entertainment tax exemption along with the relevant scheme for earlier years and claimed that the facts and circumstances continue to be identical in respect of Multiplexes in question before us. In fact, the Co-ordinate Bench has passed order in favour of the assessee for earlier years. The order passed by the Hon'ble 'C' Bench has been upheld by the Hon'ble Jurisdictional High Court in Tax Appeal Nos. 167, 168 & 169 of 2012 dated 08.01.2013. Hon'ble Jurisdictional High court held as under: "14. The very purpose of the scheme thus was to give incentive to the multiplex units which were found to be highly capital incentive. T....

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....e uphold the decision of the Tribunal in this respect." 9. The assessee, therefore, relies upon the same, however, the Ld. AO disallowed the same, which was, in turn, deleted by the Ld. CIT(A) in appeal preferred by the assessee. The Ld. CIT(A) relied upon the appellate order for A.Y. 2011-12 dated 09.09.2015 in Appeal No. CAB-1/152/2014-15, whereby and whereunder the receipts on account of entertainment tax exemption received during the previous year 2010-11 had been held to be capital receipt. The impugned amount of receipt on account of 9 units out of which receipts of 7 units has been held to be capital in nature. The other 2 units, namely, Thane and Liluah located in Maharashtra & West Bengal, respectively has also been held as capi....

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....e Ld. DR has not been able to raise any objection to such contentions made by the Ld. Senior counsel appearing for the assessee before us. 11. The issue, therefore, is before us where the object of respective subsidy schemes of State Governments was to encourage development of multiple Theatre Complexes, incentives would be held to be capital in nature or otherwise. In this aspect, we have considered the judgment passed by the Hon'ble Jurisdictional High Court and also the order passed by the Hon'ble Apex Court. 12. We have gone through the judgment passed by the Hon'ble Apex Court wherein the identical issue has been raised out of an order passed by the Hon'ble Bombay High Court in favour of the assessee and we find that the issue ha....