The Income Tax Appellate Tribunal, Delhi bench has ruled that the receipt of refund of Excise duty by the assessee is capital receipt and the same can be excluded while determining book profit under section 115JB of the Income Tax Act, 1961.
In the instant case, the assessee, Montage Enterprises Pvt. Ltd approached the Tribunal against the orders of lower authorities wherein it was held that the refund of Excise duty (Self Cenvat Credit) amounting to Rs.2,80,82,949/-, is not a capital receipt and the assessee is not entitled to the exclusion of refund of the same in the determination of total income u/s 115JB of the Income Tax Act, 1961.
The Tribunal bench found that a similar issue had been earlier concluded by its co-ordinate bench in favour of the assessee and against the Revenue.
‘Respectfully following the above decision reached by Co-ordinate Bench, we decide both these issues in favour of the assessee and against the revenue holding that the Excise duty refund (self Cenvat Credit) is a capital receipt of the assessee and the assessee was eligible to exclude such excise duty refund for determination of total income u/s. 115JB of the Act,” the bench said.
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