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2013 (7) TMI 655 - HC - Income TaxNature of Incentive from government scheme - Capital receipt or revenue receipt - Tribunal held incentive as capital receipt - Held that:- said Scheme, it can be immediately noticed that the scheme was framed as a part of Governments initiative to encourage modernization of existing industries in under-developed areas. The main purpose of the scheme was to accelerate the industrial development and to disperse industries to under-developed areas as well as to provide additional employment - It can thus be straightaway seen that the benefit, though computed in terms of the Sales Tax liability in the hands of the recipient, the same was not mean to give any benefit on day-to-day functioning of the business, or for making the industry more profitable. The principle aim of the scheme was to cover the capital outlay already made by the assessee in undertaking special modernization of its existing industry - The source of fund is quite immaterial. If the purpose is to help the assessee to set up its business or complete a project the monies must be treated as having been received for capital purposes - Following decision of Sahney Steel and Press Works Limited & Ors. vs. Commissioner of Income Tax [1997 (9) TMI 3 - SUPREME Court] - Decided against Revenue.
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