2015 (2) TMI 1345 - AT - Income Tax

Sales Tax subsidy - capital or revenue receipt - HELD THAT - The issue is covered, in favour of the assessee, by Tribunal s order in assessee s own case and that the Commissioner of Income Tax (Appeals) has merely followed the same. Learned Departmental Representative, however, vehemently relies upon the stand of the Assessing Officer. We see no reasons to take any other view of the matter than the view so taken by us in assessee s own case for other assessment years. No distinguishing factors have been pointed out by the learned Departmental Representative. In this view of the matter, and respectfully following the said orders, we uphold the conclusion arrived at by the ld. Commissioner of Income Tax (Appeals) and decline to interfere in the matter. Appeal of the Assessing Officer is dismissed.

Summary

Issues:
Appeal filed by Assessing Officer against order by CIT(A) regarding treatment of Sales Tax subsidy as capital in nature for Assessment Year 2007-08.

Analysis:

1. Treatment of Sales Tax Subsidy: The primary issue in this case revolved around the treatment of Sales Tax subsidy as capital in nature. The Assessing Officer contended that the amount of Rs. 1,12,49,936 should not have been treated as capital by the CIT(A). However, the Tribunal noted that the issue was already decided in favor of the assessee in a previous order dated 27.03.2012 for the assessee's own case. The Departmental Representative argued against this stand, but the Tribunal found no distinguishing factors presented by the representative. Consequently, the Tribunal upheld the decision of the CIT(A) and dismissed the appeal of the Assessing Officer.

2. Cross Objection by Assessee: Additionally, a Cross Objection was filed by the assessee in response to the appeal. However, during the proceedings, the assessee's counsel chose not to press the Cross Objection. As a result, the Cross Objection was dismissed by the Tribunal. With both the appeal of the Assessing Officer and the Cross Objection of the assessee being dismissed, the Tribunal concluded the matter in favor of the assessee, in line with the decision taken for the same issue in the assessee's previous case.

In summary, the judgment by the Appellate Tribunal ITAT Jabalpur involved the treatment of Sales Tax subsidy as capital in nature for the Assessment Year 2007-08. The Tribunal upheld the decision of the CIT(A) based on a previous ruling in the assessee's own case, dismissing the appeal of the Assessing Officer. Furthermore, the Cross Objection filed by the assessee was not pursued and was consequently dismissed. The Tribunal's decision was pronounced on 27.02.2015, bringing closure to the matter.