Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2012 (7) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (7) TMI 660 - HC - Income TaxSubvention assistance received from Holding Company - Revenue contested against considering the receipt as a revenue receipt - Held that:- The amount subvention money was received by the assessee from its holding company not as trader, but to recoup the losses likely to be suffered by it. The amount was received by virtue of their relationship of parent and subsidiary company and not stemming from any business considerations. If the object of the subsidy scheme was to enable the assessee to run the business more profitably then the receipt is to the revenue account. On the other hand under the subsidy scheme, if the object is to enable the assessee to set up a new unit or expand it then the receipt of the subsidy is to the capital account, thus as it is not in dispute that the assessee did incur losses , thus amount infused by BHW Holding AG, Germany to the assessee by way of subvention assistance, is taxable as a revenue receipt - in favour of assessee.
|