1997 (11) TMI 49

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..... r the assessment year 1983-84 has been referred by the Income-tax Appellate Tribunal ("the Tribunal") at the instance of the Department under section 256(1) of the Income-tax Act, 1961 (for short, "the Act") : "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the subsidy of Rs. 1,14,995 received by the assessee from the Government of India was not .....

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..... omputed without deducting the amount of subsidy from the cost of the asset. A Division Bench of this court in CIT v. Jindal Brothers Rice Mills [1989] 179 ITR 470, took the view that the amount of Central subsidy is to be deducted from the "actual cost" under section 43(1) of the Act for the purpose of calculation of depreciation. That view has been overruled by the Supreme Court in CIT v. P. J. .....

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..... plicit in, the conclusion reached by the majority of the High Courts cannot be said to be an unreasonable view and on a preponderance of preferability that view commends itself particularly in the context of a taxing statute. The expression 'actual cost' needs to be interpreted liberally. The subsidy of the nature we are concerned with, does not partake of the incidents which attract the condition .....

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