TMI Blog1998 (7) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... nal, at the instance of the Revenue, referred the following question for the opinion of this court relating to the assessment year 1982-83, under section 256(2) of the Income-tax Act, 1961 : "Whether, on the facts and in the circumstances of the case, the subsidy given by the Government of Kerala, is a capital receipt not liable to tax?" The assessee is a Kerala Government undertaking engaged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or distribution to farmers. No clear finding has been recorded by the Appellate Tribunal whether the subsidy was granted to the assessee for establishing a new unit for manufacturing or for starting some other activity or for successful running of an already established unit. In Sahney Steel and Press Works Ltd. v. CIT [1997] 228 ITR 253, the Supreme Court precisely laid down a test to distinguish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation not being clear, we have no option but to remand the case to the Appellate Tribunal for recording a clear finding as to what was the purpose for which subsidy was granted to the assessee under the Government order. In the result, the question is returned unanswered with the direction that the Appellate Tribunal will record a clear finding as to the purpose of the subsidy granted to the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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