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VST Industries Limited
head "Income from Business"
matter is now before the
liability of 75200 lakhs. This
and 78.97 crore was claimed
Hon'ble High Court of Andhra
was settled on 31 st March,
as a capital loss under the
Pradesh
1999 for an immediate
provisions of the Income Tax
payment of 1250 lakhs. The
Act.
Consequent to the above
orders, the Income Tax
settlement was not accepted
The Income Tax Appellate
Department had issued
during the assessment
Tribunal allowed the entire
consequential orders under
proceedings and accordingly
amount of <38.67 crore as a
Section 154 of the Income
disallowed by the Income Tax
capital loss. It may be noted
Tax Act demanding 728.86
Authorities. On appeal before
that the department had
crore (revised) which was
the CIT(A), the matter was
treated the entire loss as a
paid by your Company.
held in favour of your
'Speculation Loss"
b. North East
Company's
subsidiary.
However, the Income Tax
Your Company has filed an
Tribunal while holding the
appeal before the Hon'ble
You would recall that pursuant
High Court of Andhra Pradesh
to
e withdrawal
of
matter
against
your
which has been admitted. The
exemption notification for
Company's subsidiary held
matter is yet to be heard.
manufacture of cigarettes in
that the ratification of the said
the North Eastern region in
settlement agreement by the
Further in connection with its
terms of Supreme Court
Board did not relate to 31 st
divestment from the Foods
judgement of 19th September,
March,
1999
and
Business in the financial year
2005. Your Company had
consequently the liability to
1999-2000, your Company
paid an amount of <31.20
pay $1250 lakhs did not arise
had incurred a total loss of
crore towards principal and
in the financial year 1998-
753.68 crore, of which
provided an amount of
1999 and therefore not
44.18 crore was claimed as
12.69 crore towards interest.
allowable as a deduction for
a loss under the head "Income
the year. The tax liability on
from Business" and 79.50
In the income tax return filed
by your Company for the
this is 7420 lakhs apart from
crore was claimed as a
capital loss under the
relevant year, this amount was
interest.
considered as an allowable
Your Company's subsidiary
provisions of the Income Tax
Act. The Income Tax
expenditure in the assessment
preferred an appeal against
Department has disallowed
for the year 2006-07.
the above order before the
the entire amount excepting
However, subsequently the
Hon'ble High Court of Andhra
Income Tax department has
Pradesh.
5.70 crore which was
allowed as a capital loss. The
now sent a demand notice
ii. Luxury Tax
Commissioner of Income Tax
seeking payment of $20 crore
being tax payable along with
As mentioned in last year's Report,
(Appeals) further allowed
a Contempt Petition has been filed
1 1.24 crore out of the
interest. Your Company will
contest the same
in the Hon'ble Supreme Court by
balance amount of 747.98
crore, on appeal before him
C.
Subsidiary Company
the Commercial Tax Officer, on
behalf of the Government of
and the same was upheld by
During the financial year
Andhra Pradesh against the
the Income Tax Appellate
1998-1999, your Company's
Managing Director of your
Tribunal. Your Company has
subsidiary had received
Company alleging contempt of the
preferred an appeal against
financial assets worth of
Hon'ble Supreme Court's
the above order and the
1200 lakhs against a future
judgement dated 20th January,
Annual Report 2010-11
Source: https://www.industrydocuments.ucsf.edu/docs/sybx0223

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