PRINCIPAL COMMISSIONER OF INCOME TAX, SHILLONG Vs. SHREE MAHABIR FOODS LIMITED

JUDGEMENT

(1.) This appeal by the Revenue under Sec. 260-A of the Income Tax Act, 1961 ('the Act of 1961'), directed against the order dated 23.01.2015 as passed by the Income Tax Appellate Tribunal, Guwahati Bench, Guwahati ('ITAT') in the Appeal No.83/Gau/2012, was initially admitted on 27.08.2015 on the following substantial questions of law:

(2.) The relevant background aspects of the matter are that the respondent assessee-company is engaged in the business of agro based manufacturing industry and has setup an industrial undertaking at Byrnihat, Ri Bhoi District, Meghalaya for commercial production of Roller Flour Mills. During the assessment proceeding for the Assessment Year 2009-2010, it had claimed deduction of a sum of Rs.35,04,657.00 under Sec. 80-IB of the Act of 1961 towards transport subsidy received from the Government. The learned Assessing Officer, however, did not accept the claim of the assessee and, while disallowing the deduction, considered the said amount as other taxable income. In appeal, the learned Commissioner of Income Tax, Shillong endorsed the views of the Assessing Officer. Being aggrieved, the assessee preferred the said appeal bearing No.83/Gau/2012 before ITAT, while contending that disallowing of transport subsidy under Sec. 80-IB of the Act of 1961 was contrary to the law and to the facts of the case.

(3.) It is not in dispute that during pendency of the said appeal, the matter in issue was considered and examined by the Gauhati High Court in the case of Commissioner of Income Tax Vs. Meghalaya Steels Limited and others: (2013) 356 ITR 235 (Gau) and it was, inter alia, held that the transport subsidy was available for deduction under Sec. 80-IB or under Sec. 80-IC as the case may be. Thus, following the decision of the jurisdictional High Court, the ITAT allowed the appeal while holding that the assessee was entitled to claim deduction on the amount of transport subsidy.