Reported In “ Commissioner Of Income Tax v. Ponni Sugars And”[[1]]Chemicals Limited

THE HON'BLE SMT JUSTICE T.MEENA KUMARI& THE HON'BLE SRI JUSTICE NOOTY RAMAMOHANA RAO REFERRED CASE NO : 82 of 1998 ORDER: (Per Hon’ble Smt. Justice T. Meena Kumari) In this case, under Section 256(1) of the Income Tax Act, 1961, thefollowing questions are referred to this Court for opinion: (1)“Whether, on the facts and in the circumstances ofthe case, the ITAT was correct in law in directing theassessing officer to exclude the incentive received bythe assessee from the Central Government for higherfree sale release under Central Incentive scheme fornew Sugar Units of Rs.2,24,333 and Excise Rebateearned by the assessee from the Central Governmentunder Central Incentive scheme of Rs.19,896 for NewSugar Units ?the case, the ITAT was correct in law in directing theassessing officer to exclude the incentive received bythe assessee from the Central Government for higherfree sale release under Central Incentive scheme fornew Sugar Units of Rs.2,24,333 and Excise Rebateearned by the assessee from the Central Governmentunder Central Incentive scheme of Rs.19,896 for NewSugar Units ? (2)Whether, on the facts and in the circumstances of thecase, the ITAT was correct in law in holding that theincentive received by the assessee from the CentralGovernment for higher free sale release under CentralIncentive scheme for New Sugar Units of Rs.2,24,333and Excise Rebate earned by the assessee from theCentral Government under Central Incentive Schemeof Rs.19,896 for new Sugar Units are capital receipts?case, the ITAT was correct in law in holding that theincentive received by the assessee from the CentralGovernment for higher free sale release under CentralIncentive scheme for New Sugar Units of Rs.2,24,333and Excise Rebate earned by the assessee from theCentral Government under Central Incentive Schemeof Rs.19,896 for new Sugar Units are capital receipts? (3)Whether, on the facts and in the circumstances of thecase, the ITAT ought to have held that the incentivereceived by the assessee from the CentralGovernment for higher free sale release under CentralIncentive Scheme for new Sugar Units of Rs.2,24,333and Excise Rebate earned by the assessee from theCentral Government under Central Incentive Schemeof Rs.19,896 for New Sugar Units as revenue receiptsas these amounts were required to be utilized formeeting the term loans, if any, which only amounts toenhancing the working capital of the assesseecompany?”case, the ITAT ought to have held that the incentivereceived by the assessee from the CentralGovernment for higher free sale release under CentralIncentive Scheme for new Sugar Units of Rs.2,24,333and Excise Rebate earned by the assessee from theCentral Government under Central Incentive Schemeof Rs.19,896 for New Sugar Units as revenue receiptsas these amounts were required to be utilized formeeting the term loans, if any, which only amounts toenhancing the working capital of the assesseecompany?” When the matter was taken up, both the counsel submitted that theabove referred questions are covered by a judgment of the Apex Court reported in “ Commissioner of Income Tax Vs. Ponni Sugars and”[[1]]Chemicals Limited. Recording the above submission, this reference is answered interms of the above judgment. __________________________ Justice T. Meena Kumari _____________________________ Justice Nooty Ramamohana Rao Date: 17[th] March, 2010 nn. THE HON'BLE SMT JUSTICE T.MEENA KUMARI& THE HON'BLE SRI JUSTICE NOOTY RAMAMOHANA RAO REFERRED CASE NO : 143 of 1996 (Order delivered by the Hon’ble Smt. Justice T. Meena Kumari) 17/03/2010