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Subsidy received for setting up of new unit is capital receipt
Case Law Details
- Case Name
- M/s. Alkoplus Producers Pvt. Ltd. Vs DCIT (ITAT Pune)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2011-12
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M/s. Alkoplus Producers Pvt. Ltd. Vs DCIT (ITAT Pune)
Conclusion: The object of the Grain Distillery Scheme is setting of new unit and hence the subsidy is capital receipt.
Facts: Assessee is manufacturing extra neutral alcohol from grain (jawar) and received financial assistance from Maharashtra Government under Grain Distillery Scheme, 2007. AO contended the subsidy to be revenue in nature.
The CIT(A) held the amount to be in the nature of capital receipt but also applied Explanation 10 to section 43(1) and accordingly CIT(A) directed the amount of subsidy to be reduced from the cost of asse...
