Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2017 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (7) TMI 952 - AT - Income TaxApplying provision of Explanation 10 of Section 43(1) on account of subsidy received - Held that:- The admitted facts are that during the year under consideration assessee-company received incentive subsidy from Govt. of Jharkhand as encouragement for setting up of new industrial project and/or expansion/modernization of the existing unit. It is also a fact that maximum limit of the subsidy was restricted with reference to the value of fixed capital investments in land, building, plant and machinery but no part of the subsidy was specifically intended to subsidize the cost of any fixed asset, therefore, it cannot be said that the subsidy was to meet a portion of cost of the asset. According to us, the assessee has rightly not reduced the amount of subsidy received from the actual cost/WDV of the fixed assets while claiming depreciation For the purpose of computing depreciation allowable to the assessee, the subsidy amount cannot be reduced from the actual cost of the capital asset. Thus, we have no hesitation to reverse the order of the lower authorities. The Assessing Officer is directed accordingly. This issue of assessee's appeal is allowed.
|