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TMI Blog2012 (7) TMI 1113X X X X Extracts X X X X X X X X Extracts X X X X ..... idy is to be considered as revenue receipt in view of the decisions in the following cases: (1) Sahney Steel Press Works Ltd. v. CIT [1997] 228 ITR 253/94 Taxman 368 (SC). (2) Dy. CIT v. Assam Asbestos Ltd. [2003] 263 ITR 357/132 Taxman 808 (Gau). (3) CIT v. Rajaram Maize Products Ltd. [2001] 251 ITR 427/119 Taxman 492 (SC) (4) Sarda Plywood Industries Ltd. v. CIT [1999] 238 ITR 354 (Cal.). 3. The learned DR has argued the issue in detail. He has submitted that as per Transport Subsidy Scheme, 1971 of the Govt. of India, the AO has correctly taken the transport subsidy as trading receipt and added the same as income of the assessee and the learned CIT(A) wrongly deleted the addition in question considering the transport subsidy as capital receipt. The submissions of the learned DR are summarized below: (I) Under the Transport Subsidy Scheme, 1971 (hereinafter referred to as the Scheme), the subsidy is given to industrial units located in North Eastern Region (in short NER) and certain other places in respect of raw material brought in and finished goods taken out of such areas; (II) The subsidy was not admissible for internal movement of the raw material and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tance given for the purpose of carrying on of the business of the assessee. The subsidies were of revenue in nature and would have to be taxed accordingly; (IX) Under the scheme of transport subsidy also the incentive was given for production because the assessee was entitled to the incentive only after the production was started and the scheme was not to make any payment directly or indirectly for setting up of the industries. The incentives were given only after the industries have been set up and production had been commenced. The subsidy was, therefore, operational subsidy. Thus, the test laid down by the Hon'ble Apex Court in Sahney Steel Press Works Ltd. (supra) regarding treating the subsidy, as revenue receipt is fully applicable to the transport subsidy in question and the decision of the learned CIT(A) was not correct because under the scheme the subsidy was available only to meet the cost of movement of raw material and finished goods and was available only after commencement of production. (X) The Hon'ble Supreme Court while deciding the issue in the case of Sahney Steel Press Works Ltd. (supra) has referred various decisions and held that if the su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e subsidy for transport of raw materials and finished products to and from selected areas was granted under the Transport Subsidy Scheme, 1971, i.e. the scheme under consideration only for the purpose of recouping or reimbursing a portion of the transport costs incurred by an owner of a manufacturing unit set up in a backward area, so as to enable him to recoup the loss which he may suffer by way of additional transport cost and was revenue receipt; (XV) In the case of Sarda Plywood Industries Ltd. (supra) the Hon'ble Calcutta High Court was dealing with transport subsidy granted under the Subsidy Scheme in question to the unit located in Assam and the subsidy was paid under the Transport Subsidy Scheme, 1971. Thus, this case covers the case of the assessee squarely because the scheme of subsidy and the area of location of the industry is the same. The Hon'ble Calcutta High Court in the case of Sarda Plywood Industries Ltd. (supra) has also referred to the case of CIT v. Assam Asbestos Ltd. [1995] 215 ITR 847/[1996] 84 Taxman 408 (Gau); and with due respect held that the actual nature of the scheme was not duly considered. (XVI) The learned CIT(A) has wrongly mentione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee on the strength of the decision of Sahney Steel Press Works Ltd. (supra). 4. Thus, on the basis of the above submissions the learned DR reiterated that the subsidy was operational subsidy given for making the business or production and sale of goods more profitable and the payments were made only after the industries have been set up. The payments were, therefore, not for the purpose of setting up of industries but for running the industries more profitably and the payments were revenue receipt in the hands of the assessee. 5. The learned Counsel submitted that in view of the decision in the case of Assam Asbestos Ltd. (supra) the transport subsidy was correctly held by the Tribunal as not constituting revenue receipt. The learned Counsel also submitted that the SLP of the Revenue was rejected by the Hon'ble Supreme Court in this case and the subsequent decision in the case of Assam Asbestos Ltd. (supra) did not apply because the matter was remanded back and the consequent fresh assessment has not been made by the AO to their knowledge. The learned Counsel also submitted that in view of the decision in the case of Dy. CIT v. Reliance Industries Ltd. [2004] 88 ITD 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in Sahney Steel Press Works Ltd. (supra). The matter was remitted to the assessing authorities because in the absence of any decision by the taxing authorities regarding the purpose for which the subsidy was given and utilization of the subsidy by the assessee, the nature of receipt could not be ascertained. (IV) The submissions of the learned DR are correct to the effect that in the cases before us the AO has given clear finding so far as he has elaborately examined the scheme and given a correct finding that the purpose of the subsidy was to meet the extra cost on transport and it was for running of business and, therefore, as per ratio in the case of Assam Asbestos Ltd. (supra), the receipt was revenue in nature, because it has been held that the transport subsidy was covered by the decision of Sahney Steel Press Works Ltd. (supra); (V) It has also been held that where the expenditure is made for the initial outlay or for expansion of business or a substantial replacement of equipment, then it is capital expenditure. If, on the other hand, it is made not for the purpose of bringing into existence any asset or advantage for the enduring benefit of the business, but fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Premier Protein Ltd. (supra), since the subsidy was given after commencement of business and in order to help running the industry more profitably by reduction of operational cost, the receipt was revenue in nature and to be taxed accordingly in the hands of the assessee. 8. In view of the foregoing discussion and the case laws relied upon, with due respect, it is opined that the transport subsidy has been correctly taxed in the hands of the assessees as revenue receipt and it is not in the nature of capital receipt. The orders of the learned CIT(A) on this point in these cases deserve to be set aside and these of the AO deserves to be restored. The grounds of appeal of the revenue on this issue are allowed. ITA No. 165/Gau/2004 Assessment Year: 2001-02 9. So far as ITA No. 165/Gau/2004 is concerned, it was contended by the learned Counsel that the facts of its case are different because the industry of the assessee Virgo Cements Ltd. was situated in Meghalaya and express purpose of subsidy was to increase employment and ensure development of the area which was prone to insurgence. The learned Counsel in this case filed voluminous paper book giving the background pape ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20/Gau/2005 is partly allowed, C.O. No. 2/Gau/2005 is partly allowed as per decision of the learned Judicial Member and ITA No. 165/Gau/2004 is also partly allowed. ORDER ITA No. 25/Gau/2005 Hemant Sausarkar, Member (J) 15. This appeal is directed at the instance of the Revenue against the order of the learned CIT(A). 16. The AO while completing the assessment u/s. 143(3) read with section 254 of the IT Act has disallowed the claim of the assessee for ₹ 33,58,384/- being transport subsidy treating as revenue receipt, while relying on the decision in Sahney Steel Press Works Ltd. (supra) and Assam Asbestos Ltd. (supra) and the decision of the Hon'ble Tribunal in the case of India Carbon Ltd. (supra) after considering the written submission of the assessee company vide letter dated 19-7-2004 by order dated 13-7-2004 for the assessment year 1995-96. 17. The assessee filed the return of income for the assessment year 1996-97 on 30-11-1996 showing loss of ₹ 22,66,243/- and claimed deduction of ₹ 33,58,834/- being the transport subsidy treating as capital receipt, where the claim of the assessee treating the transport subsidy as capital receipt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not justified in not granting relief in respect of charging of interest u/s. 234B and 234C in the tax amount before adjustment of MAT credit available u/s. 115JA of the I.T. Act for set off against tax payable during the year. ITA No. 165/Gau/2004 25. This appeal is directed at the instance of the Revenue against the order of the learned CIT(A). 26. The AO while completing the assessment u/s. 143(3) of the Act has disallowed the claim of ₹ 17,69,493/- while treating the same as income u/s. 41(1) and disallowed the claim of the assessee for ₹ 1,52,82,538/- treating the transport subsidy as revenue receipt against the claim of the assessee being not taxable-transport subsidy receipt is capital in nature and arrived at total taxable income, book profit for ₹ 1,32,26,059/- against the return dated 10-6-2002 for loss of ₹ 6,03,85,194/-. 27. The return was accompanied with audited accounts and report in form No. 3CD which was duly processed u/s. 143(1) of the Act. Since the return falls under limited scrutiny notice u/s. 143(2)(1) of the Act was issued. In compliance to the said notice, the learned Counsel appeared and the assessment was finalized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d before us that the very purpose of the transport subsidy is to mitigate the high cost of transport incurred for the industries for transportation of raw materials and finished products. Further, the learned Sr. DR relied on the decision of Sarda Plywood Industries Ltd. (supra) wherein the Hon'ble Calcutta High Court opined that subsidy for transport of raw materials and finished goods to and from selected areas-subsidy was granted to recoup transportation cost-subsidy constitute a revenue receipt where the Hon'ble High Court referred to the decision of the Hon'ble Supreme Court Sahney Steel Press Works Ltd. (supra) and submitted that the very purpose of the scheme is to compensate the expenditure on transportation and not setting up of industries. But the subsidy utilized after commencement of production for inward transportation of raw materials and outward transportation of finished products and, therefore, the subsidy to be treated as revenue receipt and the order of the learned CIT(A) in all the appeals to be set aside being not inconsistent with the decision of Sahney Steel Press Works Ltd. (supra). 32. The learned Sr. Counsel for the assessee Shri R.R. Ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port subsidy scheme is for development of North Eastern States. The Government has not given any capital subsidy for setting up of the industries. Whereas, the other subsidies like transport subsidy etc. given with the aim to develop the North Eastern State which are economically backward. The scheme is for transportation of raw material and finished products. The amount of subsidy is utilised for working capital within the provisions of the scheme. The nature and purpose decides the character of the subsidy i.e. revenue receipt or capital receipt. It is also admitted by the learned Counsel that the transport subsidy is utilised after commencement of production within the provisions of the scheme. The very purpose of the scheme is for setting up of the industries by giving various types of concessions/subsidies to the new units as well as existing units where substantial expansion is made within the provisions of the scheme. Therefore, the very motive of the scheme is to be judged from the angle of industrial development. Further, the learned Counsel of the assessee has drawn our attention towards the decisions of Reliance Industries Ltd. (supra), Assam Asbestos Ltd. (supra), 195 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the purpose of the scheme which is clear that it is to meet the high cost of transport expenditure and, therefore, utilised after commencement of production and, therefore, it is revenue receipt and heavily relied on Sahney Steel Press Works Ltd. (supra), Assam Asbestos Ltd. (supra) and Sarda Plywood Industries Ltd. (supra). The learned Sr. Counsel Shri R.P. Agarwal has summed up his submission showing that the over all purpose of the scheme is for industrial development and, therefore, to be treated as capital receipt. It is made clear before us that there is no capital subsidy given for setting up of industries within the scheme but all the concessions and subsidies are given just with the aim to meet the high cost of transportation to make the products competitive in the market and through the allowability or otherwise or character of the subsidy is to be decided on the basis of complete scheme and its objective and not of nature of the subsidy and its utilization. The Learned Sr. Counsel Shri H.S. Kumbhat also submitted that pioneer status subsidy and power subsidy are part of the scheme and therefore, subsidies are capital in nature. 35. We have heard the rival subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench treated the transport subsidy as capital in nature against which in appeal the learned Bench of the jurisdictional High Court in order Assam Asbestos Ltd. (supra) has considered the order of the learned Bench of the Tribunal in the case of Assam Asbestos Ltd. (supra) while rejecting the appeal, since no question of law arises against which the Revenue was in appeal before the Hon'ble Supreme Court wherein the SLP was also rejected by order dated 29-11-1996 in SLP(Civil) No. 5030/1996 which indicates that the Hon'ble High Court and Supreme Court has concurred the opinion of the Tribunal in their order i.e. Assam Asbestos Ltd. (supra). More so, the learned Bench of the Hon'ble High Court in Lachit Films v. CIT [1992] 195 ITR 402/65 Taxman 156 (Gau.) has taken the same view i.e. giving of financial aid or subsidy at the discretion of the Government through grant in aid received by the assessee. The financial aid or subsidy given by the Government with a view to encourage the industry, not as a product of normal activities and such grant in aid is not revenue receipt liable to be included in the total income of the assessee. 37. The learned Counsel of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t like dividends etc., but circulated in working capital for the production purpose, we are of the opinion that the transport subsidy receipts are capital in nature. 39. The Hon'ble Tribunal in the case of Reliance Industries Ltd. (supra) has also taken the same view. The Hon'ble Bench of the Tribunal in ITA No. 421/Gau/1988 order dated 4-12-1992 has taken the similar view while deleting the addition. The Hon'ble M.P. High Court in CIT v. Dusad Industries [1986] 162 ITR 784/27 Taxman 4, CIT v. Progressive Engineering [1993] 200 ITR 231 (Kar.) and CIT v. Tirumala Bricks Tiles Factory [1996] 217 ITR 547/85 Taxman 143 (AP) the Hon'ble Gauhati High Court in Lachit Films (supra) have also taken the same view. Therefore, we are of the opinion that the subsidy i.e. transport subsidy received by the assessees which are under consideration before us are to be treated as capital subsidy and not liable to tax. 40. However, in ITA No. 99/Gau/1993 order dated 25-8-2000 the issue has been remanded by the Hon'ble Tribunal and in ITA No. 149/Gau/2000 order dated 30-5-2003 the Tribunal have taken the same view and whereas the learned DR has not brought on record any as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as revenue receipt. 46. Regarding ground No. 2 relating to book profit u/s. 115JB the learned CIT(A) has directed the AO to adopt the profit as per provisions of part II and III of Sixth Schedule of the Companies Act and recalculated the net profit. Therefore, we find that the order is within the provisions of the Act and, therefore, the ground of appeal is also allowed while confirming the order of the learned CIT(A). 47. Ground No. 3 is general in nature, which requires no specific adjudication. 48. In the result, the appeals of the Revenue and the CO. filed by the Assessees are disposed off as discussed above. ORDER UNDER SECTION 255(4) OF THE INCOME-TAX ACT, 1961 In these appeals there is difference of opinion between the Members of the Bench. Therefore, the following question is referred to the Hon'ble President of the Income-tax Appellate Tribunal u/s. 255(4) of the I.T. Act, 1961 for opinion of the Third Member. The points of difference is as under: Whether on the facts and in the circumstances of the case the transport subsidy is to be treated as capital in nature in view of decisions in the following cases- (i) CIT v. Assam Asbestos Ltd. [1995] 21 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee is a private limited company engaged, inter alia, in the business of flour mill. In the course of the assessment proceedings, the Assessing Officer noticed that the assessee had received a sum of ₹ 17,45,750 which was directly credited to 'reserves and surplus'. The assessee's stand was that, in view of the Tribunal's decision in the case of IAC v. Assam Asbestos Ltd. [1986] 25 TTJ (Gau.) 610, transport subsidy is a generous act of the State, or rather a grant or gift to the assessee for the sole purpose of assisting the assessee for the growth by industries and economic developments and prosperity of the state and, therefore, cannot considered as a trading or a revenue receipt liable to the assessed to tax under the provisions of the income tax law . The assessee further contended that, It has further been held that it is not the intention of the State to grant subsidy-by right hand for utilizing the same for the growth of industries and developing the State as a whole, and again, by left hand, take away a major chunk of the subsidy by way of taxes . The Assessing Officer was of the view that this action was diagonally opposite to the guidelines of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tos Ltd. (supra) was misplaced because Hon'ble High Court had also observed that In the present case, we do not find any of the taxing authorities had considered the question of the purpose of the subsidy given to the appellant and how the subsidy had been utilized by the assessee and the matter was simply remanded back to the Assessing Officer. Learned CIT(A) was, therefore, of the view that the said judicial precedent cannot be said to be either in favour or against the Department or the appellant (i.e. the assessee) . Learned CIT(A) then referred to and relied upon a Special Bench decision of this Tribunal in the case of Reliance Industries Ltd. (supra) in support of the proposition that if subsidy is given for setting up or expansion of industry in backward area, it will be capital (receipt) irrespective of modality or source of funds, through or from which it is given, and if monies are given for assisting the assessee in carrying out the business only after and conditional upon the commencement of production, it will be a revenue receipt . The CIT(A) was of the view that the Special Bench decision in the case of Reliance Industries Ltd. (supra) is fully applicable on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y more profitably by reduction of operational cost. Learned Accountant Member also opined that as held by Special Bench decision in the case of Reliance Industries Ltd. (supra), if the subsidy was given for the setting up or expansion of industries in a backward area, it would be capital in nature irrespective of modalities of sources of funds, whereas if the money is given for assisting the assessee in carrying out business operations thereafter, and conditional upon commencement of production, it would be revenue in nature , but he added that so far as the issue whether transport subsidy under consideration before us is concerned, Hon'ble Calcutta High Court's direct decision on the issue in the case of Sarda Ply wood Industries Ltd. (supra) must hold the field, and it cannot be ignored as it is directly in the context of transport subsidy. Learned Accountant Member also discussed the judicial precedents in great detail and concluded that the transport subsidy, on the facts of the case, is a revenue receipt and taxable in the hands of the assessee. He declined to be associated with the stand taken by the learned Judicial Member. It was a result of this split decision tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the report of the Supreme Court, while dealing with subsidies granted after setting up of a new industries and after commencement of production, described such subsidies as an assistance given for the purpose of carrying on the business of the assessee. 13. In the case before us, there is no dispute that the subsidies granted are revenue receipts and have been granted after setting up of the new industries and after commencement of production. In a sense, therefore, as contended by learned counsel for the assessee, the transport subsidy would have the effect of reducing the inward and outward transport costs for the purposes of determining the cost of production as well as for sales. 56. It is thus clear that Hon'ble High Court has proceeded on the basis that the transport subsidy is revenue in nature and that the transport subsidy is an assistance given for the purpose of carrying on the business of the assessee . In the light of these observations of Hon'ble High Court, nothing really survives for adjudication by us. The views expressed by Hon'ble High Court are fully binding on us and we must respectfully follow the same. Once Their Lordships are pleased to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the incentives were to be given. The second important thing to note is that the manner in which the incentives were given is of no consequence for determination of the question raised in this case. Incentives were given by way of refund of sales-tax or raw material, machinery and finished goods. Similarly, subsidy on power was confined to 'power consumed for production'. In other words, if power is consumed for any other purpose like setting up the plant and machinery, the incentives will not be given. Refund of sales-tax will also be in respect of taxes levied after commencement of production and up to a period of five years from the date of commencement of production. It is difficult to hold these subsidies as anything but operational subsidies. These subsidies were given to encourage setting up of industries in the State of Andhra Pradesh by making the business of production and sale of goods in the State more profitable, The Apex Court upon taking into consideration the decisions of the English Court as also various High Courts including this Court in Kesoram Industries Cotton Mills Ltd. v. CIT (supra), held : That precisely is the question raised in this cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transport costs between Siliguri and the location of the industrial unit in these States/Union territories. While calculating the transport costs of raw materials the cost of movement by railway from Siliguri to the railway station nearest to the location of the industrial unit and thereafter the cost of movement by road to the location of industrial unit will be taken into account Similarly, while calculating the transport costs of finished goods, the cost of movement by road from the location of industrial unit to the nearest railway station and thereafter the cost of movement by rail to Siliguri will be taken into account. In the case of North-Eastern Region, for raw materials moving entirely by road or other mode of transport, the transport cost will be limited to the amount which the industrial unit might have paid had the raw materials moved from Siliguri by rail up to the railway station nearest to the location of the industrial unit and thereafter by road. Similarly, in the case of movement of finished goods moving entirely by road or other mode of transport in the North-Eastern region, the transport cost will be limited to the amount which the industrial unit might hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c; a subvention.' Reference is made to 60, Corpus Juris Secundum, Vol. 83, p. 760, gives the following under the heading of subsidy: Something, usually money, donated or given or appropriated by the Government through its power agencies, a grant of funds or property from a Government, as of the state or a municipal corporation, to a private person or company to assist in the establishment or support of an enterprise deemed advantageous to the public; a subvention. Pecuniary premiums offered by the Government to persons enlisting in the public service, or engaging in particular industries, or performing specified services for the public benefit are treated in bounties'. A subsidy, therefore, can be granted, inter alia, for the manufacturer to sell his commodity to consumers at a low price. A bare perusal of the relevant provisions of the scheme as noticed hereinbefore, would show that the subsidy is granted so as to recompense the cash of a manufacturing unit to the extent of the extra transport costs which a manufacturer has to incur. Such transport costs are not necessarily paid in their entirety. The same are related to: (1) cost incurred for transport of raw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 253 (SC), that where subsidies or grants are given by the Government to assist the trader to earn profit in his business, they are, generally speaking, payments of a revenue nature. As we have seen above, the English judiciary has gone to the length of saying that even where the supplementary trade receipts are in the form of advances which are subject to contingencies of repayment they are still to be treated as supplementary trade receipts. Mr. Poddar learned counsel, however, submitted that the learned Judges proceeded on a wrong premise insofar it was held that the motive behind the grant of subsidy is not conclusive and in support of his aforementioned contention placed strong reliance upon a decision in CIT v. P.J. Chemicals Ltd. (supra). In that case before the Apex Court the nature of the subsidy was for the purpose of meeting a portion of the cost of the assets though quantified as or geared to a percentage of such cost. It is only in that situation, the Apex Court observed: But the real question is as to the character and nature of a subsidy whether it was really intended to subsidies the cost of the capital or was intended as an incentive to encourage entrepre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be in possession of the tea gardens, the manufacture of tea was stopped completely. The question raised therein was as to whether the compensation paid under the Defence of India Rules was revenue receipt or not Such a question does not arise for consideration in the instant case. 31. In Bombay Burmah Trading Corpn. Ltd. v. CIT [1988] 169 ITR 148 (Bom), the Bombay High Court was again concerned with a question as to whether compensation granted would be a revenue receipt as during the period in question the assessee was not in possession to carry out his business. 32. In CIT v. Groz-Beckert Saboo [1979] 116 ITR 125 (SC), the question which arose was as to whether the raw materials and semi-finished needles received by the assessee from its West German collaborators by way of gift were capital assets or not They were held to be so keeping in view the facts and circumstances of the case. 33. In CIT v. Anand Co. (supra), a Division Bench of this Court was considering a question as to whether a subsidy received from the Indian Cotton Mills Federation was in the nature of voluntary and gratuitous payment and not liable to pay tax. In that case the assistance having been rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... films in the state, film production of the state will be encouraged and the state will reap the benefits of an organised flourishing film industry shifting to the state from elsewhere. It was noticed that the subsidy was not granted either to assist the producer in film-making or to increase his profits as the amount was too small to achieve any such purpose. 38. Keeping in view the facts and circumstances of this case we, therefore, find ourselves in complete agreement with the Division Bench decisions of this Court in Jeewanlal (1929) Ltd. v. CIT (supra), Merinoply Chemicals Ltd. v. CIT (supra) and Kesoram Industries Cotton Mills Ltd. v. CIT(supra), and hold that transport subsidy is granted only for the purpose of recouping or reimbursing a portion of the transport costs incurred by an order of a manufacturing unit set up in a backward area, so as to enable him to recoup the loss which he may suffer by way of additional transport cost The said subsidy was, therefore, not granted by way of capital assets. The said question, therefore, is answered in the affirmative, i.e., in favour of the Revenue and against the assessee. 57. Learned counsel's defence against the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edents cannot be negated unless that decision is reversed or overruled or unless a forum higher thereto directly decides that issue in a some other manner. Whether a judicial precedent is any longer good in law in the light of development of judicial school of thought in a particular manner is not a question which can be decided by a lower forum. We decline to do so. The issue is directly covered by Hon'ble Calcutta High Court's decision in the case of Sarda Plywood Industries Ltd. (supra) and there is no contrary decision on the issue of transport subsidy, there are observations made about the nature of subsidy by Hon'ble jurisdictional High Court in the case of Meghalaya Steels (supra) which support the case of the revenue, and there is no direct decision in favour of the assessee. I, therefore, uphold the stand of the Assessing Officer and vacate the relief granted by the CIT(A). 58. As I part with the matter, I must place on record exceptional research work and arguments advanced by the learned counsel and his elaborate sub-missions on the first principles. However, as the issue is being decided on the short ground of direct judicial precedents, I see no reasons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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