M/S VARDHMAN ACRYLICS LTD vs. COMMISSIONER OF INCOME TAX LDH AND ANR
What did the High Court hold?
The High Court held that in view of the consensus between the parties, who were ad idem, the order dated 20.1.2014 passed by the Income Tax Appellate Tribunal, Chandigarh Bench, is set aside. The matter is restored to the Tribunal for adjudication afresh. The Tribunal is directed to determine whether the sales tax subsidy received by the assessee is a revenue or a capital receipt. This determination should be made by reference to the nature and purpose of the subsidy. The reasoning is based on the parties' agreement and the precedent set by the High Court's earlier judgment in ITA No.146 of 2014. The operative direction is to remand the matter to the ITAT for fresh consideration.
What were the facts?
The appeal was filed by M/s Vardhman Acrylics Limited (the assessee) against the order dated 20.1.2014 passed by the Income Tax Appellate Tribunal (ITAT), Chandigarh Bench. The respondents were the Commissioner of Income-Tax, Ludhiana, and another. The High Court of Punjab and Haryana at Chandigarh was hearing the appeal. Both parties agreed that the ITAT's order needed to be set aside and the matter restored to the Tribunal for fresh adjudication. This agreement was based on a previous judgment dated 18.12.2014 in ITA No.146 of 2014, also involving M/s Vardhman Acrylics Ltd. and the Commissioner of Income-Tax.
What were the issues?
1. Whether the Income Tax Appellate Tribunal's order dated 20.1.2014 is to be set aside and the matter restored to the Tribunal for fresh adjudication. (Question of law) Assessee's Contention: The assessee, through its counsel, agreed with the revenue that the ITAT's order should be set aside and the matter remanded to the Tribunal. This was in line with a previous judgment of the High Court in a related matter. Revenue's Contention: The revenue, through its counsel, also agreed that the ITAT's order should be set aside and the matter restored to the Tribunal for fresh adjudication. The revenue's position was consistent with the assessee's, referencing the same prior High Court judgment.
AI-generated summary — verify with the full judgment below
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
ITA No. 239 of 2014
M/s Vardhman Acrylics Limited
... Petitioner Versus Commissioner of Income-Tax, Ludhiana & anr. ... Respondents CORAM:- HON'BLE MR. JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE B.S. WALIA Present: Ms. Radhika Suri, Sr. Advocate, with Ms. Rinku Dahiya, Advocate, for the appellant. Mr. Rajesh Katoch, Advocate, for the respondents. . RAJIVE BHALLA, J.(Oral) Counsel for the parties are ad idem that in view of judgment dated 18.12.2014, passed in ITA No.146 of 2014 (M/s Vardhman Acrylics Ltd. Vs. Commissioner of Income Tax, Ludhiana & anr.), order dated 20.1.2014 passed by the Income Tax Appellate Tribunal, Chandigarh Bench, has to be set aside and the matter may be restored to the Tribunal to determine whether sales tax subsidy is a revenue or a capital receipt, by reference to the nature and purpose of the subsidy. In view of statement made by counsel for the parties, order dated 20.1.2014 passed by the Income Tax Appellate Tribunal is set aside and the matter is restored to the Tribunal for adjudication afresh in terms of the order dated 18.12.2014 passed in ITA No.146 of 2014 (supra).
( RAJIVE BHALLA ) JUDGE 28.01.2015
( B.S. WALIA ) monika
JUDGE MONIKA VERMA 2015.02.09 12:51 I attest to the accuracy and authenticity of this document chandigarh
Recent GST High Court judgments
Search GST case law →- Sh Umang Uniyal vs. Commissioner Department Of Central Goods And Services TaxUttarakhand · 16 Oct 2026
- Shivaraj M S vs. The Union Of INDIAKarnataka · 15 Oct 2026
- Paresh Textiles Prop Paresh Gudhka vs. Superintendent Range Iv Div VBombay · 15 Oct 2026
- M/S Palladium Constructions PVT LTD. vs. Principal Commissioner Of Central TaxKarnataka · 15 Oct 2026
- M/S. Vk Construction vs. The Deputy State Tax Officer - IiMadras · 15 Oct 2026
