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2019 (6) TMI 1210 - AT - Income TaxTaxability of subsidy received under TUF scheme - revenue or capital receipts - CIT(A) treated it as part of fixed assets - no reduction in value of fixed assets as subsidy is not attached to any specific fixed asset - HELD THAT:- We note that where a portion of the cost of an asset acquired by the assessee has been met directly or indirectly by the Central Government or State Government in the form of subsidy then so much of the cost as is relatable to such subsidy shall not be included in the actual cost of the asset. When such subsidy cannot be directly relatable to the asset acquired, then such subsidy shall not be included in the actual cost of the asset. That is, to reduce from the cost of asset, the subsidy should be directly or indirectly used for acquiring an asset. In the assessee’s case under consideration no asset was being acquired by using TUF subsidy therefore it should not be reduced from fixed assets. However, such TUF subsidy is to be treated capital receipt. Respectfully following the judgment M/S. RASOI LIMITED [2018 (5) TMI 127 - ITAT KOLKATA] we note that the subsidy received under TUF scheme is capital receipt and therefore we delete the addition made by the Ld. CIT(A).
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