TaxTMI 
TaxTMI 
2023 (7) TMI 1511
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....2(1) of the Act were issued and served on the assessee. The assessee is engaged in the manufacturing and trading of Viscose Staple Fiber, Textile, Power, Cement, Sponge Iron, Shipping, Plant & Machinery. The Assessing Officer ("AO"), vide order dated 20/02/2006, passed under section 143(3) of the Act, assessed the total income of the assessee at Rs. 1196,50,28,870, after making certain additions/disallowances to the income declared by the assessee. The learned CIT(A), vide impugned order, granted partial relief to the assessee. Being aggrieved, both, the assessee as well as the Revenue, are in appeal before us. ITA no.3517/Mum./2006 Assessee's Appeal - A.Y. 2005-06 3. The assessee, in its appeal, has raised the following grounds:- "The appellant prefers an appeal against the order of the Commissioner of Income Tax (Appeals) - XXVI [hereinafter referred as "CIT (A)"] on the following amongst other grounds each of which is without prejudice to any other. 1. Disallowance under section 43B 1.1. On the facts and circumstances of the case and in law, the CIT (A) erred in not allowing the amounts paid or written back during the previous year amounting t....
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....on loan to Subsidiary Company 6.1. On the facts and circumstances of the case and in law, the CIT (A) erred in upholding the action of AO in not allowing deduction of Rs. 37.10 crores towards loss on loans given to subsidiary Company. 6.2. The CIT (A) ought to have held that the loss of Rs. 37.10 crores is allowable deduction while computing taxable business income. 7. Disallowance u/s. 40(a)(ia) 7.1. On the facts and circumstances of the case and in law, the CIT (A) erred in upholding the action of AO in disallowing the liability of Rs. 2,67,92,244/- towards year-end expenses applying provision of section 40 (a)(ia). 7.2. The CIT (A) ought to have deleted the disallowance and held that the provision of section 40(a)(ia) are not applicable in the case. 8. Deduction u/s. 80G 8.1. On the fact and circumstance of the case and in law, the CIT(A) erred in upholding the action of AO in rejecting claim of deduction u/s. 80G of Rs. 29,772/-. 8.2. The CIT (A) ought to have held that deduction u/s. 80G is allowable against the taxable profit of the Company. 9. Miscellaneous Receipts 9.1. On the facts an....
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....04, for the assessment year 2003-04, dismissed similar issue while following the decision rendered in assessee's own case in preceding years. The relevant findings of the coordinate bench, in the aforesaid decision, are reproduced below:- "6. We find that a similar issue came up for consideration before the coordinate bench of the Tribunal in assessee's own case in Grasim Industries Ltd. v/s ACIT, in ITA no.4753/Mum./ 2004 and ITA no.5584/Mum./2004, for the assessment year 2002-03, wherein the coordinate bench, while dismissing the similar issue, following the earlier decision rendered in assessee's own case, observed as under:- "6. Considered the submissions and material placed on record, we observe from the record that identical issue is decided in favour of the assessee for the A.Y. 2001-02. While deciding the issue, the Coordinate Bench of the Tribunal in ITA.No. 4083/Mum./2003 dated 22.10.2014 held as under: - "2. Rival contentions have been heard and perused the record. The assessee is engaged in manufacturing and sale various products. During the course of scrutiny assessment, the A.O. disallowed assessee's claim of deduction u/s 43-8 o....
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....ing in ground no.2, raised in assessee's appeal, is pertaining to the disallowance on account of Club Membership fee. 9. During the hearing, the learned Sr. Counsel, by referring to the order dated 08/08/2006, passed by the AO giving effect to the order passed by the learned CIT(A), submitted that the Club Membership fee of Rs. 5,02,800, is already been allowed by the AO vide aforesaid order. 10. In view of the aforesaid submissions of the learned Sr. Counsel, ground no.2, raised in assessee's appeal is rendered academic and therefore, is left open. 11. The issue arising in ground no.3, raised in assessee's appeal, is pertaining to the taxability of Sales Tax exemption received by the assessee. 12. The brief facts of the case pertaining to the issue, as emanating from the record, are: During the year under consideration, the assessee availed Sales Tax exemption benefit of Rs. 143.12 crore from the State Governments for setting-up of industries in the notified area. The assessee claimed that the Sales Tax exemption is a capital receipt not chargeable to tax and, therefore, is to be excluded from the profit while computing the income taxable under the head "Income From Bu....
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....object for the grant of the incentive by the State Governments is to promote setting up industries in the backward/notified areas and therefore, the subsidy is capital in nature. In the year under consideration, the assessee received sales tax subsidiary under the following schemes:- • Packet Scheme of Incentive, 1988 dated 01/10/1988 by State of Maharashtra • Sales Tax New Incentive Scheme for Industries 1989, Rajasthan • Sales Tax Exemption Scheme (Madhya Pradesh Industrial Policy & Action Plan, 1994) • Sales Tax Waiver Scheme (Package of Fiscal Incentives offered by Government of Tamil Nadu to Industries) • Punjab Industrial Incentive Code under the Industrial Policy, 1996 • Haryana Valued Added Tax Act, 2003 • Sales Tax Exemption Scheme (M.P. Vanijyikar Adhiniyam, 1994) • Sales Tax Incentive Scheme (Incentives offered by Government of Gujarat under the New Incentive Policy-Capital Investment Incentive (General) Scheme-1995-2000) 55. We find that the taxability of sales tax exemption received under the schemes of the State of Maharashtra, Haryana, Rajasthan, and Madhy....
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....ital receipts not chargeable to income tax. In this regard, we find that ld. AR placed reliance on the decision of Hon'ble Supreme Court in the case of Ponni Sugars and Chemicals Ltd., reported in 306 ITR 392, wherein the incentive conferred under that scheme were two fold. First, in the nature of higher free sale sugar quota and second, in allowing the manufacturer to collect Excise duty on sale price on the free sale sugar in excess of the normal quota, but to pay to the Government only the Excise duty payable on the price of levy sugar. The Hon'ble Supreme Court in para 14 of its decision had held that ―character of receipt of subsidy has to be determined with respect to the purpose for which the subsidy is given. The point of time at which the subsidy is paid is not relevant. The source is immaterial. The form of subsidy is immaterial." In fact, the Hon'ble Supreme Court while rendering this decision had duly considered its earlier decision in the case of Sahney Steel and Press Works Ltd., reported in 228 ITR 253 and had absolutely no quarrel with that judgement. Rather, it concurred with the decision rendered in Sahney Steel and Press Works Ltd., case. In this regard, it....
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....Co. 's case (supra)as well as that of Lincolnshire Sugar Co. Ltd. 5 case (supra)that subsidy given by the Canadian Government to encourage construction of dry docks was 'an aid to the construction of dry dock and not an operational subsidy'. 17. This precisely is the question raised in this case. By no stretch of imagination can the subsidies whether by way of refund of sales tax or relief of electricity charges or water charges can be treated as an aid to setting up of the industry of the assessee. As we have seen earlier, the payments were to be made only if and when the assessee commenced its production. The said payments were trade for a period of five years calculated from the date of commencement of production in the assessee's factory. The subsidies are operational subsidies and not capital subsidies." 56. Thus, respectfully following the aforesaid decision, rendered in assessee's own case, we are of the considered view that the sales tax exemption received by the assessee, in the year under consideration, under the similar schemes of the State of Maharashtra, Haryana, Rajasthan, and Madhya Pradesh are in the nature of capital receipts and t....
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....n scheme of the Government of Gujarat is of the nature similar to the schemes considered by the coordinate bench in the earlier years, and thus, sales tax exemption received under this scheme is in the nature of capital receipt. 59. As regards the Punjab Industrial Incentive Code under the Industrial Policy, 1996, forming part of the paper book from pages 481-490, we find that the said scheme was formulated with a view to promote growth of the industry in the State and for that purpose it provides various incentives for new industrial units that come into production or undertake expansion on or after 01/04/1996. We find that in the scheme, inter-alia, the capital subsidy is provided to the new large and medium units set up in the notified area as mentioned in Annexure-I of the scheme. We find that under the said scheme certificate of eligibility was also issued to the assessee in respect of Vikram Bathinda Cement Grinding Unit. Thus, the dominant purpose for which this incentive scheme was introduced is also for setting up the industry in the notified area to promote industrial growth in the State. Therefore, we are of the considered view that the sales tax exemption recei....
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....ouse property. The AO held that the assessee cannot be allowed both deductions and therefore proceeded to compute the disallowable part of depreciation. 20. The learned CIT(A), vide impugned order, dismissed the ground raised by the assessee on this issue. Being aggrieved, the assessee is in appeal before us. 21. During the hearing, the learned Sr. Counsel submitted that in previous years, the property was used by the assessee as one of its office premises. However, in the year under consideration, the same was not used as an office by the assessee and was let out. The learned Sr. Counsel submitted that the property remained part of the block of assets in the year under consideration and accordingly, the depreciation was computed. 22. On the other hand, the learned Departmental Representative ("learned DR") submitted that the assessee has not used the property for business purposes during the year under consideration and rather the same was let out. The learned DR further submitted that the property should be ready to use for claiming depreciation, which is not so in the present case. 23. We have considered the submissions of both sides and perused the material availabl....
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.... the block of assets" shall have the same meaning as in clause (c) of sub-section (6) of section 43." 26. Section 43(6)(c) of the Act reads as under:- "(c) in the case of any block of assets,- (i) in respect of any previous year relevant to the assessment year commencing on the 1st day of April, 1988, the aggregate of the written down values of all the assets falling within that block of assets at the beginning of the previous year and adjusted,- (A) by the increase by the actual cost of any asset falling within that block, acquired during the previous year; (B) by the reduction of the moneys payable in respect of any asset falling within that block, which is sold or discarded or demolished or destroyed during that previous year together with the amount of the scrap value, if any, so, however, that the amount of such reduction does not exceed the written down value as so increased; and (C) in the case of a slump sale, decrease by the actual cost of the asset falling within that block as reduced- (a) by the amount of depreciation actually allowed to him under this Act or under the corresponding provisions of the Indian Income-....
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.... para 20), the existing system in this regard requires the calculation of depreciation in respect of each capital asset separately and not in respect of block of assets. This requires elaborate book-keeping and the process of checking by the Assessing Officer is time consuming. The greater differentiation in rates, according to the date of purchase, the type of asset, the intensity of use, etc., the more disaggregated has to be the record-keeping. Moreover, the practice of granting the terminal allowance as per section 32(1)(iii) or taxing the balancing charge as per section 41(2) of the Income-tax Act necessitate the keeping of records of depreciation already availed of by each asset eligible for depreciation. In order to simplify the existing cumbersome provisions, the Amending Act has introduced a system of allowing depreciation on block of assets. This will mean the calculation of lump sum amount of depreciation for the entire block of depreciable assets in each of the four classes of assets, namely, buildings, machinery, plant and furniture." 28. Further, as per section 43(6)(c)(i)(B) of the Act, the written down value in the case of any block of assets is reduced by the mo....
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....Thus, in view of the above, once the property forms part of the block of assets, carving out the depreciation for the said property and disallowing the same goes against the spirit of allowing depreciation on the entire block of depreciable assets. Before concluding, we may note that in this appeal the Revenue has not disputed the claim of deduction under section 24 of the Act in respect of the property which forms part of the block of assets. Thus, merely because the Revenue has accepted the claim of deduction under section 24 of the Act doesn't mean that the property which forms part of the block of assets will cease to be so. Therefore, the disallowance of depreciation of Rs. 45,681 made by the AO is deleted. As a result, ground No. 4 raised in assessee's appeal is allowed. 30. The issue arising in ground no.5, raised in assessee's appeal, is pertaining to the adjustment of the amount receivable from the debtors against the provision for doubtful debts made in the assessment year 1986-87. 31. Before us, the learned Sr. Counsel, at the outset, submitted that in the assessment year 1986-87, the deletion of disallowance of provision for doubtful debts was upheld by the coordi....
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....ieved, the assessee is in appeal before us. 40. We have considered the submissions of both sides and perused the material available on record. We find that similar issue came up for consideration before the coordinate bench of the Tribunal in assessee's own case for the assessment year 2004-05. The coordinate bench, vide order dated 23/06/2023 cited supra, restored this issue to the file of the AO for de novo adjudication, by observing as under:- "49. We have considered the submissions of both sides and perused the material available on record. In the year under consideration, the assessee included miscellaneous receipts of Rs. 10,10,73,313 for the purpose of computation of deduction under section 80 IA of the Act. As per the details of miscellaneous receipts, provided on page 135 of the paper book, these receipts include interest, excess/short provision, prior period adjustments, rent, miscellaneous receipts, job charges, exchange rate difference, export incentive, profit on the sale of DEPB license, notice pay and sludge sales. As per the assessee, all these receipts are directly connected with and derived from the eligible business, and therefore, should be considere....
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....sions of both sides and perused the material available on record, we find that the coordinate bench of the Tribunal, vide order dated 14/12/2021, passed in assessee's own case for the assessment year 2002-03 cited supra, by following the decision rendered in the preceding year, observed as under:- "15. Considered the submissions and material placed on record, we observe from the record that identical issue is decided in favour of the assessee for the A.Y. 2001-02. While deciding the issue in favour of the assessee the Coordinate Bench of the Tribunal in ITA.No. 4083/Mum/2003 dated 22.10.2014 held as under: - "7. The assessee is also aggrieved for taxing of interest received from Income Tax Department amounting to Rs. 13,64,09,609/-. We find that similar issue has been dealt with by the Tribunal in A.Y. 1993-94 in ITA No. 1523/Mum/1997 vide para 62 as under;- "We have heard the parties and considered the rival submissions. These refunds have been granted to the assessee in the year under consideration and therefore they would partake the character of income of the assessee. If however, any refund has been found to be not refundable to the assessee and cons....
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....ional ground of appeal is pertaining to the taxability of dividend received from Egyptian company. Since, the issue raised by way of additional ground is a legal issue, which can be decided on the basis of material available on record, we are of the view that the same can be admitted for consideration and adjudication in view of the ratio laid down by the Hon'ble Supreme Court in NTPC v/s CIT, [1998] 229 ITR 383 (SC). During the year under consideration, the assessee received Rs. 2,68,71,018, as a dividend from M/s Alexandria Carbon Black Company S.A.E., a company incorporated and registered under the laws of Egypt (U.A.R.). It is the plea of the assessee that the aforesaid dividend received from the Egyptian company is not taxable in India. 48. We find that the coordinate bench, vide order dated 23/06/2023, passed in assessee's own case for the assessment year 2004-05 cited supra, decided a similar issue against the assessee in light of the amendment in section 90 of the Act, vide Finance Act, 2003, w.e.f. 01/04/2004, by observing as under:- "65. The issue arising in the aforesaid additional ground of appeal is pertaining to the taxability of dividend received from Egy....
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....on 90(3) was brought in the statute, giving a Legal frame work for clarifying the intent of one of the negotiating parties;" 66. The coordinate bench of the Tribunal also noted the legal position as it existed prior to the aforesaid amendment as under:- "57A. If we analyse all the judgments as have been referred to above, it is evident that:- • Firstly, in R.M. Muthaiah (supra), the expression "may be taxed" has not been expressly dealt with, however, in the context of Article-6(1), wherein similar phraseology has been used, the High Court has given its decision that once it has been taxed in the foreign country, the same cannot be taxed in India. Thus, this decision in a way interprets the phrase "may be treated" to mean that source country has a right to tax to the exclusion of resident state; • Secondly, in S.R.M. Firm (supra), the High Court has in a very clear terms, has interpreted the expression "may be taxed" to mean that once the income is taxable in other contracting State that is country of source then country of resident i.e., India is precluded from including the same income in India; • Thirdly, the Hon'ble Supre....
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....04/2004, by which sub-section (3) to section 90 has been brought in the statute, whereby there was a clear departure from the earlier position, is not applicable to that year. However, since the amendment vide Finance Act, 2003 to section 90 was held to be effective from 01/04/2004 and thus applicable from the assessment year 2004-05, therefore the year under consideration will be governed by the aforesaid amended provisions and Notification no. 91 of 2008 dated 28/08/2008 issued under section 90(3) of the Act is also applicable. We find that the coordinate bench of the Tribunal in Technimont (P.) Ltd. v/s ACIT, [2020] 116 taxmann.com 996 (Mumbai - Trib.), after taking into consideration the aforesaid amendment observed as under:- "10. It may be recalled that, with effect from 1st April 2004, a new sub-section 3 was inserted in Section 90, and this new sub-section provided that "(a)ny term used but not defined in this Act or in the agreement referred to in sub-section (1) shall, unless the context otherwise requires, and is not inconsistent with the provisions of this Act or the agreement, have the same meaning as assigned to it in the notification issued by the Central Go....
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....01/2013 is dismissed. 50. The assessee, vide application dated 06/02/2015, sought admission of the following additional grounds of appeal:- "1 On the facts and the circumstances of the case and in law the learned AO erred in not treating TUF subsidy of Rs. 0.71 Cr as capital receipt and not chargeable to tax. 2 The Appellant prays that the learned AO be directed to increase the deduction allowed to the assessee on account of interest cost by Rs 0.71 Cr being TUF subsidy deducted from interest cost claimed during the year. 3 The Appellant craves leave to add and/or to amend and/or to alter the above Ground of Appeal." 51. The issue arising in the aforesaid additional ground of appeal is pertaining to treating the subsidy received by the assessee under Technology Upgradation Fund ("TUF") Scheme as capital receipt and thus not chargeable to tax. Since, the issue raised by way of additional ground is a legal issue, which can be decided on the basis of material available on record, we are of the view that the same can be admitted for consideration and adjudication in view of the ratio laid down by the Hon'ble Supreme Court in NTPC v/s CIT, [1998] 229 ITR....
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.... Id. CIT(A) erred in directing to treat the interest subsidy of Rs. 15,23,25,727/- as capital in nature." 38.1 In ground No.11 the Revenue has assailed the findings of CIT(A) in holding interest subsidy from Technology Up gradation Fund(TUF) Rs. 15,23,25,727/- as capital in nature. The ld. Authorized Representative for the assessee submitted that the Hon'ble Rajasthan High Court in the case of PCIT vs. Nitin Spinners Ltd. in DB Income Tax appeal No.31/2019 decided on 19/09/2019 has held subsidy received under TUF as capital in nature. Similar view has been taken by Mumbai Tribunal in the case of ACIT vs. SVG Fashions Ltd. in ITA No.704/Mum/2016 for assessment year 2012-13 decided on 17/07/2018. The ld. Authorized Representative for the assessee to further buttress his submissions placed reliance on the following decisions:- (1) CIT vs. Gloster Jute Mills Ltd. ,96 taxmann.com 303 (Cal) (2) CIT vs. Sshyam Lal Bansal, 200 Taxman 14 (P&H) 38.2 The ld. Authorized Representative for the assessee further submitted that CIT(A) has decided this issue after seeking remand report of Assessing Officer and examining TUF scheme in details. The ld. Authorized R....
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....the facts and the circumstances of the case and in law, the learned AO erred in treating Education cess as disallowable expenditure under Section 40(a)(ii) of the Act. 3.2 The Appellant prays that the learned AO be directed to allow deduction of Education Cess while computing the total income of the Appellant. 3.3 The Appellant craves leave to add and/or to amend and/or to alter the above Ground of Appeal." 55. The issue arising in the aforesaid additional grounds of appeal is pertaining to the disallowance of Education Cess under section 40(a)(ii) of the Act. Since the issue raised by way of additional ground is a legal issue, which can be decided on the basis of material available on record, we are of the view that the same can be admitted for consideration in view of the ratio laid down by the Hon'ble Supreme Court in NTPC v/s CIT, [1998] 229 ITR 383 (SC). 56. We find that Finance Act, 2022, with retrospective effect from 01/04/2005, inserted Explanation 3 to section 40(a)(ii), whereby it has been provided that the term 'tax' shall include and shall be deemed to have always included any surcharge or cess, by whatever name called, on such tax. ....
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....e disallowance of Rs. 1,31,93,113/- as incurred towards earning of exempt dividend income by relying upon his decision for earlier years without appreciating that the same have not been accepted by the department by filing an appeal with the ITAT. 6. On the facts and in the circumstances of the case and in law, the CIT(A) erred in directing the AO not to reduce the claim of deduction of Rs. 1,00,90,705/- u/s. 80-IA by relying upon his earlier orders on the issue for Asst. Years 1996-97 to 2003-04 without appreciating that the department had not accepted the same by filing an appeal to the ITAT. 7. On the facts and in the circumstances of the case and in law, the CIT(A) erred in directing the AO to allow deduction of Rs. 25,71,93,534/- u/s. 80-IA in respect of profits of Rail System Raipur and Hotgi by relying upon his decision for the AYrs. 2003-04 without appreciating that the department has not accepted the same by filing an appeal with the ITAT. 8. The appellant prays that the order of CIT(A) on the above grounds be set aside and that of the Assessing Officer be restored." 59. The issue arising in ground no.1, raised in Revenue's appeal, is pertaini....
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.... no change in facts and law was alleged in the relevant assessment year. This issue is recurring in nature and has been decided in favour of the assessee in the preceding years. Therefore, respectfully following the judicial precedent in assessee's own case cited supra, ground no.1, raised in Revenue's appeal is dismissed." 61. In the absence of any allegation regarding the change in facts or in law in the present case, we find no reason to deviate from the conclusion so reached by the coordinate bench in the preceding year. We find that this issue is recurring in nature and has been decided in favour of the assessee in the preceding years. Therefore, respectfully following the judicial precedent in assessee's own case cited supra, ground no.1, raised in Revenue's appeal is dismissed. 62. The issue arising in ground no.2, raised in Revenue's appeal, is pertaining to deletion of disallowance towards contribution to local organization. 63. Having considered the submissions of both sides and perused the material available on record, we find that the coordinate bench of the Tribunal, vide order dated 13/06/2023, passed in assessee's own case for the assessment year 2003-04 cit....
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....cial precedent in assessee's own case cited supra, ground no.2, raised in Revenue's appeal is dismissed." 64. In the absence of any allegation regarding the change in facts or in law in the present case, we find no reason to deviate from the conclusion so reached by the coordinate bench in the preceding year. We find that this issue is recurring in nature and has been decided in favour of the assessee in the preceding years. Therefore, respectfully following the judicial precedent in assessee's own case cited supra, ground no.2, raised in Revenue's appeal is dismissed. 65. The issue arising in ground no.3, raised in Revenue's appeal, is pertaining to the deletion of disallowance on account of rural development expenses. 66. Having considered the submissions of both sides and perused the material available on record, we find that the coordinate bench of the Tribunal, vide order dated 13/06/2023, passed in assessee's own case for the assessment year 2003-04 cited supra, while deciding similar issue in favour of the assessee by following the decision rendered in the preceding year, observed as under:- "83. Having considered the submissions of both sides and perused t....
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.... in Revenue's appeal is dismissed. 68. The issue arising in ground no.4, raised in Revenue's appeal, is pertaining to the deletion of disallowance made on account of expenses incurred for making advertisement films. 69. Having considered the submissions of both sides and perused the material available on record, we find that the coordinate bench of the Tribunal, vide order dated 13/06/2023, passed in assessee's own case for the assessment year 2003-04 cited supra, while deciding similar issue in favour of the assessee by following the decision rendered in the preceding year, observed as under:- "97. Having considered the submissions of both sides and perused the material available on record, we find that the Coordinate bench, vide order dated 14/12/2021, passed in assessee's own case for the assessment year 2002-03, while following the decision rendered in the preceding year, decided the similar issue in favour of the assessee by observing as under:- "94. Considered the submissions and material placed on record, we observe from the record that identical issue is decided in favour of the assessee for the A.Y. 2001-02 in favour of the assessee. While deciding ....
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....eived a exempt dividend of Rs. 34,16,21,175. During the assessment proceedings, the assessee submitted that the investments in shares/securities on which tax-exempt dividend is received were made out of internal accruals and own funds. It was further submitted that no borrowings were made for the purpose of making these investments and no expenditures were incurred for earning tax-exempt dividend income. The AO, vide assessment order passed under section 143(3) of the Act, computed the disallowance of Rs. 1,31,93,113, as expenditure incurred for earning exempt income as per section 14A of the Act. 73. The learned CIT(A), vide impugned order, following the judicial precedents rendered in assessee's own case deleted the disallowance made by the AO under section 14A of the Act. Being aggrieved, the Revenue is in appeal before us. 74. Having considered the submissions of both sides and perused the material available on record, it is evident from the Balance Sheet of the assessee as no 31/03/2005, forming part of the paper book on Page-71, that the assessee has share capital and reserves & surplus of Rs. 4328.35 crore, while the investment made is of Rs. 2982.05 crore during the y....
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....see the Coordinate Bench of the Tribunal in ITA.No. 4083/Mum/2003 dated 22.10.2014 held as under:- "54. The issue in ground No. 18 pertains to the apportionment of head Office expenses while computing deduction u/s 80IA of the Act. 55. This issue has been dealt with by the ld. CIT(A) vide his order in page 15-16, para 23.5 & 23.6. We found that the issue has been decided by the Tribunal in assessee's own case in its favour in assessment years 1994-95 to 1998-99 and the Department is not in appeal against the order of the Tribunal. Respectfully following the order of the Tribunal, we do not find any reason to interfere with the order of ld. CIT(A) on this issue.." 110. Respectfully following the above decision, we do not find any reason to interfere with the order of the Ld.CIT(A) and dismiss the ground raised by the revenue. We order accordingly." 110. The learned DR could not show us any reason to deviate from the aforesaid decision rendered in assessee's own case and no change in facts and law was alleged in relevant assessment year. This issue has been decided in favour of the assessee in the preceding years also. Therefore, respectfully follo....
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....rsigned. It stated that the appellant company had established a cement plant in Raipur. The nearest available Railway Siding was at a distance of around 20 kilometres from the plant. To facilitate inward and outward movement of goods, the appellant developed infrastructure facility of Rail System. which was made operative in September 1999. The appellant company duly entered into an agreement with Southern East Railway, which is a part of Government of India. It was submitted that there was option available u/s 801A with the appellant to claim deduction for any 10 consecutive years at its own choice. The appellant has opted for claiming the deduction from AY2003-04 onwards. The income offered for tax by the appellant includes income from Rail System. 16.5 The appellant further submitted that the Rail System is a 'Profit Centre'. The Rail System is engaged in business of providing transportation facility to the cement plant, profit of which is embedded in the profit of the appellant company as a whole. By developing this infrastructure facility, there has been a saving in transportation cost and all over profits of the Company has increased due to such savings. All ....
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....ed for any purpose. It was therefore, argued that the Rail System is not a part of the cement unit but is an independent unit. 16.8 The appellant submitted that the conditions specified in Section 801A (4)() in respect of an infrastructure facility are fully satisfied in the present case. The Rail System is owned by the appellant company which is a company registered in India. The appellant has entered into an agreement with the Central Government for operating and maintaining the new infrastructure facility. It has started operating and maintaining the infrastructure facility after 1st April 1995. 16.9 The appellant submitted that there is no basis on which the Assessing Officer has mentioned that the legislature's intention was to cover organisations like Konkan Railway, Delhi Metro Corporation, etc. There is no such specific mention in the Act. The appellant relied on the decision of the Bajaj Tempo Ltd vs CIT 156 ITR 188(SC). 16.10 Regarding maintenance of separate books of account, the appellant submitted that there is no such condition for grant of tax holiday benefit. Although separate books of account are not maintained, profit of the eligible....
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....) vide impugned order came to the conclusion that all the 3 conditions required to be fulfilled as per section 80-IA(4)(i) of the Act are satisfied by the assessee. At the outset, it is pertinent to note that in respect of the same rail terminal at Rawan District, Raipur, deduction under section 80-IA of the Act was allowed in the case of assessee's subsidiary company in UltraTech cement Ltd v/s DCIT, in ITA No. 1412/Mum./2018, etc., vide order dated 14/12/2021, by the coordinate bench of the Tribunal. 124. In the assessment order, the AO held that in the present case, the rail system does not have any agreement with the authorities mentioned above. On the contrary, the learned DR though agreed that the assessee has entered into an agreement with South-Eastern Railway administration on 10/04/2000 for the Rail System at Rawan District, Raipur, however, submitted that the same is subsequent to the commencement of operations on 25/09/1999. The learned DR also submitted that since the infrastructure facility was made operational during the financial year 1999-2000, therefore, the claim of benefit under section 80-IA for the alleged infrastructure facility is to be examined as ....
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....perating and maintaining or (iii) developing, operating and maintaining any infrastructure facility which fulfils all the following conditions, namely :- (a) it is owned by a company registered in India or by a consortium of such companies; (b) it has entered into an agreement with the Central Government or a State Government or a local authority or any other statutory body for (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining a new infrastructure facility; (c) it has started or starts operating and maintaining the infrastructure facility on or after the 1st day of April, 1995:" 126. We find that all the aforesaid conditions are satisfied in the present case for claiming deduction under section 80-IA of the Act. As regards the submission of the learned DR that the assessee has constructed a private siding for captive use, we find that similar submission was rejected by the coordinate bench of the Tribunal in the case of assessee's subsidiary company in UltraTech cement Ltd (supra), vide order dated 14/12/2021. Further, even though the agreement was entered on 10/04/2000, and the operations commenced i....