TMI Blog2021 (1) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... Whether on the facts and in the circumstances of the case, the Ld. CIT(A) has erred in law in holding that the amount received by the assessee of ₹ 2,55,27,120/- as Industrial Promotion Assistance from the State Govt is capital in nature as against revenue receipt as treated in the order u/s. 254 by the AO. 2. At the outset, it is noted that there is a delay of 16 days on the part of the revenue in filing this appeal before the tribunal. In this regard, the Revenue has filed an application seeking condonation of the said delay and keeping in view of the reasons given therein, which are supported by an affidavit filed by the Assessing Officer (DCIT, Circle-6(1), Kolkata, we are satisfied that there was a sufficient cause for the delay of 16 days on the part of the revenue in filing this appeal before this Tribunal. Even the Ld. Counsel has not raised any objection in this regard. The delay of 16 days on the part of the revenue in filing this appeal is accordingly condoned and this appeal of the revenue is being disposed off on merits. 3. The assessee in the present case is a company, which is engaged in the business of manufacturing of cement, jute goods etc. The re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee for exemption on account of Industrial Promotion Assistance to be capital in nature. Aggrieved by the order of the Ld. CIT(A), the revenue has preferred this appeal before this Tribunal. 5. We have heard the arguments of both the parties and also perused the relevant records. The Ld. Representatives of both the sides have agreed that the solitary issue involved in this appeal filed by the revenue is squarely covered by the various orders of this Tribunal in assessee s own case on similar issue. In one of such orders passed for the AYs 2008-09 to 2009-10 (ITA Nos. 971/Kol/2012 Ors, dated 25-08-2017), similar claim of the assessee for exemption on account of Industrial Promotion Assistance was allowed by the Tribunal for the following reasons:- 4.3. We have heard the rival submissions and perused the materials available on record including the paper book containing the entire West Bengal Incentive Scheme 2000 and eligibility certificate issued by the competent authority approving the expansion of existing unit thereby approving the fact of assessee falling under the category of 'Mega Unit' under the said scheme. We find that Subsidy could be reduced fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidy under Rajasthan Sales Tax Scheme. 1998 was received explains the purpose of the scheme as incurring capital expenditure for installation of plant and machinery and for eligible for fixed capital investment. Even the issue of assessee is covered in its favour by Tribunal 's decision in assessee's own case all along from AYs 2002-03 to 2006- 07. It is not brought to our notice by the Revenue that the matter has been decided by Hon'ble Calcutta High Court, despite a query from the Bench. In such circumstances, and taking a consistent view, we hold that the CIT(A) has rightly treated the sales tax subsidy receipt as 'capital in nature'. 8. In respect to the issue of application of Explanation-10 to Sec. 43(1) of the Act we find from the facts of the case that the Rajasthan Govt. has framed a incentive scheme i.e R.S.T/C.S.T Exemptions Scheme 1998 for encouragement of setting up of industrial project or expansion of existing industrial projects. It is also a fact that the maximum limit of the subsidy was restricted with reference to the value of fixed capital investment in land, building, plant machinery but no part of the subsidiary was specifically int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er any law or by any other person, in the form of a subsidy or grant or reimbursement (by whatever name called), then, so much of the cost as is relatable to such subsidy or grant or reimbursement shall not be included in the actual cost of the asset to the assessee. It is further, provided thereunder, that where such subsidy or grant or reimbursement of such nature that it cannot be directly relatable to the asset acquired, so much of the amount which bears to the total subsidy or reimbursement or grant the same proportion as such asset bears to all the assets in respect of or with reference to which the subsidy or grant or reimbursement is so received, shall not be included in the actual cost of the asset to the assessee. In order to invoke Explanation 10, it is necessary to show that the subsidy was directly or indirectly used for acquiring an asset. This is again a question of fact. The relatable subsidy to such asset can be reduced from the cost only if it is found that the cost for acquiring that asset was directly or indirectly met out of the subsidy. Likewise in the proviso, it is necessary to show that the subsidy has been directly or indirectly used to acquire an asset bu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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