Subsidy to set up new unit/expand existing unit is capital receipts

Subsidy to set up a new unit or to expand an existing unit is capital receipts, purpose test will prevail Brief of the Case ITAT Delhi held in the case of M/s. Shivalik Prints Limited vs. ACIT that in the judgment of CIT vs. Ponni Sugars and Chemicals Ltd. 306 ITR 392 (SC), the Hon’ble Supreme court have held that the character of the receipt of a subsidy in the hands of the assessee under a scheme has to be determined with respect to the purpose for which the subsidy is granted i.e. one has to apply the purpose test. The point of time at which the subsidy is paid is not relevant. If the obj...