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TMI Blog2019 (11) TMI 133X X X X Extracts X X X X X X X X Extracts X X X X ..... achinery was purchased. The aforesaid claim of the assessee requires verification, therefore considering the totality of the fact deem it appropriate to set aside this issue back to the file of the A.O. to be adjudicated afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee. Calculation of the book profit u/s 115JB - not deducting the amount of Capital Subsidy from the book profit - HELD THAT:- A.O. considered the Subsidy as capital receipt and reduced it from the cost of assets therefore it was not chargeable to tax at all under any head of the income, then it could not have been treated as part of the Net Profit as per Profit Loss Account, so could not have been held to be taxab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... subsidy by not deducting the amount of capital subsidy from book profit calculation and treated as revenue receipt. Simultaneously, on the other hand, the said amount of capital subsidy has been reduced from cost of fixed assets. Thus amounts to double taxation. 4. That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same. 3. Vide Ground No. 1 the grievance of the Assessee relates to the confirmation of disallowance of depreciation and additional depreciation as claimed on capital subsidy which was required to be deducted from the cost of fixed assets. 4. Facts of the case in brief are that the assessee e-fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n paid on such amount. It is fictitious assets. While computing taxable income of the assessee company, such amount of subsidy has been deducted from the income of the company. As subsidy amount has not received so it is not to be reduced from cost of machinery. After receiving the subsidy, amount should be reduced from cost of assets. 6. The A.O. after considering the submissions of the assessee observed that the contention of the assessee did not hold merit and accordingly the same was rejected. The A.O. reduced the Capital Subsidy of ₹ 32,59,741/- from the cost of machinery and claim of depreciation alongwith additional depreciation was restricted to the actual cost of machinery. Accordingly excess claim of depr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... However, for the year under consideration an amount of ₹ 10,04,264/- was received and not the whole amount of subsidy of ₹ 32,59,741/-. It was further submitted that neither the A.O. nor the Ld. CIT(A) appreciated the facts in right perspective and wrongly worked out the additional depreciation which is available only in the year of purchase and not in subsequent years. 11. In her rival submissions the Ld. Sr. DR strongly supported the orders of the authorities below and reiterated the observations made in their respective orders. 12. I have considered the submissions of both the parties and perused the material available on the record. In the present case it is an admitted fact that the A.O. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... available on the record it is notice that this issue has been set aside by ITAT Mumbai J Bench in the aforesaid referred to case and the relevant findings have been given in para 23 of the order dt. 13/01/2017 in the case of M/s JSW Steel Limited, Mumbai Vs. ACIT, Circle 11(5), Bangalore (supra) which read as under: 23. From the perusal of aforesaid decisions, at the outset, it may appear that on similar nature of issues there are divergent views of various benches of the Tribunal, however, one common point/ratio permeating through all the decisions, which can be deduced by us is that, if an assessee company is in receipt of a 'capital receipt' which is not chargeable to tax at all, that is, it does not fall wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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