JAI COKE INDUSTRIES,KOLKATA vs. DCIT CIRCLE-40, KOLKATA

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, KOLKATA SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

ITA No. 908/KOL/2026 Assessment Year : 2014-2015

Jai Coke Industries, Vs. DCIT, Circle-40, 5F, Electronic Centre, 1/1A, 3 Govt. Place West, Biplabi Anukul Chandra Street, Kolkata - 700001 Kolkata - 700072 [PAN: AAFFJ6737J] APPELLANT RESPONDENT

Assessee by : Shri Rakesh Dubey, Adv. Revenue by : Shri Subrata Aich, JCIT, Sr. DR

Date of hearing : 15.06.2026 Date of Pronouncement : 24.06.2026

O R D E R This is an appeal filed by the assessee against the order passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) by the Ld. Addl./Joint Commissioner of Income Tax (Appeals), Agra [hereinafter referred to as “the Ld. CIT(A)] dated 07.02.2026, DIN & order No. ITBA/APL/S/250/2025-26/1086104172(1) on the following grounds of appeal:

“1. That the Appeal Order of Ld. Additional/ JCIT (Appeal) of Agra (National Faceless Appeal Centre (NFAC) Agra dated 17.02.2026 received on 19.02.2026 as passed by the Ld. Addl/JCIT (A) (NFAC) Agra is against the Law and Facts of the case.

2 ITA No. 908/KOL/2026 Jai Coke Industries 2. That your assessee explained entire queries as made by Ld. A.O. by submitting papers, relating to Entry Tax and explain the same but Ld. A.O. failed to examine the documents and submission. 3. That Entry tax exempted for Traders in the State of Assam but Entry Tax chargeable to manufacturers and your assessee challenged the said policy by filing Writ Petition vide WP(C)/3645/2017 before the Hon'ble Hight Court at Guwahati. 4. That your assessce paid advance entry tax which was reflected in the schedule of balance Sheet and Provision was made for adjustment of Advance entry Tax after disposal Writ and same was explained by your assessee before the Ld. CIT (A) but Ld. CIT not considered the same. 5. That Provision of the Entry tax made for adjustment from advance entry tax. That is itself evidence that your assessee paid Advance Entry Tax. That addition as made by the Ld. A.O. as well as confirmed by the Ld. CIT (A) (NFAC) is bad and against of Natural Justice. 6. That Ld. CIT (A) (NFAC) has wrongly confirmed the addition of Rs. 12,09,666/-which was made for adjustment after the disposal of Writ Petition. 7. The Ld CIT (Appeals) (NFAC) Agra erred in fact and in confirming the addition of Entry Tax of Rs. 12,09,666/- as made by Income Tax officer, Assessment Unit without considering fact of the case. 8. That your Assessee is Manufacturing unit situated at North East Region as Industrial undertaking and getting deduction u/s 80IC since 2007-08. That according to CBDT Circular No. 37/2016 dated 02.11.2016 the disallowances/ additions related to the business activity against which the Chapter VI-A deduction has been claimed, result in enhancement of the profits of the eligible business, and that deduction under Chapter VI-A is admissible on the profits so enhanced by the disallowance. 9. That Ld. NFAC Agra has wrongly conformed the Entry Tax which was made for adjustment of Entry Tax from Advance payment of Entry Tax that action of the Ld. CIT (Appeals) (NFAC) order is liable to be set aside and/or quashed. 10. That your assessee has reserved their right to alter, to modify, to amend, to rectify, add the grounds of appeal and/ or to take additional grounds of appeal on or before hearing of the case.” 2. Briefly stated the facts of the case are that the AO passed the order u/s 143(3)/263 of the Act on 25.06.2019 making addition of Rs. 12,09,666/- on account of provision for entry tax. The assessee filed its

3 ITA No. 908/KOL/2026 Jai Coke Industries return of income on 29.01.2014 declaring ‘Nil’ income after claiming deduction u/s 80IC of the Act of Rs. 17,45,40,762/-. The assessment was completed u/s 143(3) of the Act assessing total income of Rs. 2,24,40,17,130/-. Later on, the Ld. PCIT exercise his jurisdiction u/s 263 of the Act and directed to AO to make addition towards provision of entry tax which was allowed by the AO in 143(3) proceeding of Rs. 12,09,666/-. Accordingly, the AO passed the consequential order.

4 ITA No. 908/KOL/2026 Jai Coke Industries Vs. DCIT-40, Kolkata in ITA No. 252/Kol/2021, order dated 09.06.2022, the similar issue has considered and decided in favour of the assessee.

On the other hand, the Ld. DR relied on the order of lower authorities and submitted that the provisions are not allowed at all as per section 37 of the Act. The provision made by the assessee also not supported by any evidence that the liability is ascertained liability and occurred up to the end of the financial year.

“2. The assessee in the present case is a firm which is engaged in the business of manufacturing of coke. The return of income for the year under consideration was filed by it on 29.11.2014 declaring its total income at Nil. In the assessment originally completed u/s 143(3) vide an order dated 27.12.2016, the total income of the assessee was determined by the Assessing Officer at Rs. 43,13,44,440/-. Thereafter, proceeding u/s 263 was initiated by the Ld. PCIT and order was passed on 20.02.2019. In terms of order passed by ld. PCIT, the assessment u/s 143(3) r.w.s. 263 was completed by the AO on 25.06.2019. After making an addition of Rs. 8,95,771/- on account of disallowance ‘Provision for Entry Tax’. The assessee dissatisfied with the above order and preferred an appeal before the Ld. CIT, National Faceless Appeal Centre which was dismissed on 06.04.2021. 3. Aggrieved by the action of Ld. CIT, National Faceless Appeal Centre, the assessee is in appeal before us. 4. We have heard both the parties and perused the material available on record. The assessee has raised total five grounds in this appeal. Ground no. 2 goes roots of the case and we take this issue first. The assessee challenging

5 ITA No. 908/KOL/2026 Jai Coke Industries the issue about the addition of Rs. 8,95,771/- on account of ‘Provision for Entry Tax’ 5. At the time of hearing, the ld. AR submitted that the assessee filed a writ petition in Civil no. 3644 of 2017 before the Hon’ble Gauhati High Court at Guwahati which is still pending regarding applicability of entry tax upon the assessee as imposed by the authority and the provision was made by the assessee only to protect its liability by making such provision and to give this effect entry tax was debited to profit and loss account as an expenditure. He further submitted that assessee paid advance entry tax of Rs. 1,44,64,585/- which is shown under other current asset in Schedule E of balance sheet and during the year entry tax of Rs. 8,95,771/- debited into profit and loss account and also shown the said entry tax among other current liability, as because the assessee already advance payment was made under entry tax and such provision will be adjusted from the advance entry tax after disposal of writ petition. 6. On the other hand, the ld. DR relied on the order of Ld. CIT, National Faceless Appeal Centre. 7. We after going through the material available on record and submission made by the parties it reveals that the assessee had paid advance entry tax to the tune of Rs. 1,44,64,585/- which is shown under the other current asset under Schedule ‘E’ of balance sheet and during the year entry tax of Rs. 8,95,771/- debited into profit and loss A/c and also shown the said entry tax amount under the current liabilities, as the assessee already advance payment was made under entry tax and such provision will be adjusted from advance entry tax after disposal of writ petition which is still pending before the Hon’ble Gauhati High Court vide (Civil) No. 3644 of 2017 and the assessee had already paid the entry tax in advance, although the said provision was made only for adjustment after the disposal of the writ petition by the Hon’ble Gauhati High Court and accordingly we allowed Rs. 8,95,771/- on account of provision of entry tax made by the assessee since assessee had already paid advance entry tax. 8. However, it is made clear that the provision made by the assessee will be adjusted from the advance payment entry tax after the disposal of the writ petition which is still pending before the Hon’ble Gauhati High Court and consequential tax effects should be taken into consideration in terms of such order passed by the Hon’ble Gauhati High Court.” 7. Respectfully following the above judgment, I allow the appeal of the assessee and Ld. DR could not controvert against the judgment cited by the Ld. Counsel.

6 ITA No. 908/KOL/2026 Jai Coke Industries 8. In the result, appeal of the assessee is allowed.

Order pronounced on 24.06.2026.

Sd/- (Laxmi Prasad Sahu) Accountant Member

Dated: 24.06.2026 AK, Sr. P.S. Copy of the order forwarded to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. CIT(DR)

//True copy// By order

Assistant Registrar, Kolkata Benches