The Substantial Question Of Law Involved In This Appeal Is Squarely Coveredin Favour Of The Assessee And Against The Revenue In The Light Of The Decision Ofthe v. M/S.chaphalkar Brothers Pune, (2018) 400 Itr 279 (Sc). The Operative Portion Of Thejudgment Reads As Follows

IN THE HIGH COURT AT CALCUTTASPECIAL JURISDICTION (INCOME TAX)ORIGINAL SIDE ITA/120/2018 THE PRINCIPAL COMMISSIONER OF INCOME TAX-4, KOLKATAVS.M/S. KRISHI RASAYAN EXPORTS PVT. LTD. BEFORE : THE HON’BLE JUSTICE T.S. SIVAGNANAM AndTHE HON’BLE JUSTICE SUPRATIM BHATTACHARYADate : SEPTEMBER 14, 2022. Appearance:Mr. Tilak Mitra, Adv.… for appellantMr. R.K. Murarka, Sr. Adv.Mr. S.D. Verma, Adv.…for respondent The Court :- This appeal filed by the revenue under Section 260A of theIncome Tax Act, 1961 (the `Act’) is directed against the order dated 8[th] March,2017 passed by the Income Tax Appellate Tribunal “A” Bench, Kolkata (Tribunal)in I.T.A. No. 883 & 1018/Kol/2014 for the assessment year 2010-2011. The appeal was admitted to decide the following substantial question oflaw:- “Whether the interest subsidy and excise refund would be treated ascapital receipt or revenue receipt for the purpose of computation of bookprofit under the provision of Section 115JB of the Income-Tax Act, 1961 ?” We have heard Mr. Tilak Mitra, learned standing Counsel appearing for theappellant/revenue and Mr. R.K. Murarka, learned senior Counsel appearing forthe respondent/assessee. The substantial question of law involved in this appeal is squarely coveredin favour of the assessee and against the revenue in the light of the decision ofthe Hon’ble Supreme Court in Commissioner of Income-Tax-I, Kolhapur vs. M/s.Chaphalkar Brothers Pune, (2018) 400 ITR 279 (SC). The operative portion of thejudgment reads as follows :- “After setting out both the Supreme court judgements referred tohereinabove, the High Court found that the concessions were issued inorder to achieve the twin objects of acceleration of industrial developmentin the State of Jammu and Kashmir and generation of employment in thesaid State. Thus considered, it was obvious that the incentives would haveto be held capital and not revenue. Mr. Ganesh, learned Senior Counsel,pointed out that by an order dated 19.04.2016, this Court stated that theissue raised in those appeals was covered, inter alia, by the judgment inPonni Sugars, and the appeals were, therefore, dismissed. We have no hesitation in holding that the finding of the Jammu andKashmir High Court on the facts of the incentive subsidy contained in thatcase is absolutely correct. In that once the object of the subsidy was toindustrialize the State and to generate employment in the State, the fact that the subsidy took a particular form and the fact that it was grantedonly after commencement of production would make no difference.” Identical issue was also considered by this Court in the case of PrincipalCommissioner of Income-Tax vs. Ankit Metal And Power Ltd., (2019) 416 ITR 591(Cal) wherein apart from considering the effect of the subsidy the Court alsoconsidered as to whether when a receipt is not in the character of income asdefined under Section 2(24) of the Act, whether it can be said to form part of thebook profit under Section 115 JB. The said question was answered in favour ofthe revenue in the following terms :- that the subsidy took a particular form and the fact that it was grantedonly after commencement of production would make no difference.” Identical issue was also considered by this Court in the case of PrincipalCommissioner of Income-Tax vs. Ankit Metal And Power Ltd., (2019) 416 ITR 591(Cal) wherein apart from considering the effect of the subsidy the Court alsoconsidered as to whether when a receipt is not in the character of income asdefined under Section 2(24) of the Act, whether it can be said to form part of thebook profit under Section 115 JB. The said question was answered in favour ofthe revenue in the following terms :- “31. In this case since we have already held that in the relevantassessment year 2010-11 the incentives “interest subsidy” and “powersubsidy” is a “capital receipt” and does not fall within the definition of“income” under section 2(24) of the Income-tax Act, 1961 and when areceipt is not on in the character of income it cannot form part of the bookprofit under section 115JB of the Act, 1961. In the case of Apollo TyresLtd. (supra) the income in question was taxable but was exempt under aspecific Provision of the Act as such it was to be included as a part of thebook profit. But where a receipt is not in the nature of income at all itcannot be included in the book profit for the purpose of computation undersection 115JB of the Income-tax Act, 1961. For the aforesaid reason, wehold that the interest and power subsidy under the schemes in questionwould have to be excluded while computing book profit under section115JB of the Income-tax Act, 1961. The third issue involved in the instantappeal which requires adjudication is whether the action of the Tribunalentertaining/allowing the claim which was made by the assessee before theAssessing Officer by filing a revised computation instead of filing a revised return since the time to file the revised return had lapsed, for claiming totreat the incentive subsidies in question as capital receipts instead ofrevenue receipts as claimed in original return. The Assessing Officer haddenied this claim. The Revenue has attacked the order of the Tribunal byrelying on the decision in the case of Goetze (India) Ltd. v. CIT reported in[2006] 284 ITR 323 (SC). This case does not help the Revenue/appellant. In this case theSupreme Court has made it clear that its decision was restricted to thepower of the assessing authority to entertain a claim for deductionotherwise than by a revised return, and did not impinge on the power ofthe Appellate Tribunal under section 254 of the Income-tax Act, 1961. TheHon’ble Supreme Court in the said decision held as follows (page 324 of284 ITR): “In the circumstances of the case, we dismiss the civil appeal.However, we make it clear that the issue in this case is limited to thepower of the assessing authority and does not impinge on the powerof the Income-tax Appellate Tribunal under section 254 of theIncome-tax Act, 1961.” This judgment was followed by our court in the case of CIT v.Britannia Industries Ltd. reported in [2017] 396 ITR 677 (Cal) holding thatthe Tribunal has the power to entertain the claim of deduction not claimedbefore the Assessing Officer by filing a revised return. Respectfullyfollowing the aforesaid decision as well as the view already taken by us inthis case that the aforesaid subsidies are capital receipt and not an“income” and not liable to tax, the Tribunal in exercise of its power undersection 254 of the Income-tax Act justified this claim though no revisedreturn under section 39(5) of the Act was filed before the Assessing Officer.We answer both the question Nos. 1 and 2 in the negative and in favour ofthe assessee. Accordingly, the appeal of the Revenue is dismissed with no order asto cost. In the light of the above decisions, the substantial question of law framedfor consideration has to be answered against the revenue. Accordingly, the appeal is dismissed on the substantial question of law. (T.S. SIVAGNANAM, J.) (SUPRATIM BHATTACHARYA, J.) GH/Pkd/S.Pal/SN