TMI Blog2009 (5) TMI 72X X X X Extracts X X X X X X X X Extracts X X X X ..... uld not have been received without that obligation, there was a clear nexus and consequently a diversion of income. Hence, from any point of view the amounts received took the nature of capital receipt by reason of the incentive scheme and thus, could not be treated as part of the assessee’s income – held that - main eligibility condition for the scheme was that the incentive had to be utilised fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law in holding that the incentive received by the assessee by way of additional quota for free sale of sugar under the Sampat scheme as capital receipt. Whether, on the facts and in the circumstances of the case, the amount of incentive received by the assessee could be taxed under section 28(iv) of the Act ?" 2. The appeal relates to the assessment year 1994-95. Before the Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty was based on the obligation to recoup the capital employed, since the amount could not have been received without that obligation, there was a clear nexus and consequently a diversion of income. Hence, from any point of view the amounts received took the nature of capital receipt by reason of the incentive scheme and thus, could not be treated as part of the assessee's income." 3. The Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt as it was not towards the repayment of loan taken for setting up a sugar factory. 6. Sri Shakeel Ahmad, learned counsel, however, relied upon a decision of the apex court rendered in the case of CIT v. Ponni Sugars and Chemicals Ltd. [2008] 306 ITR 392, wherein the similar scheme was under consideration and the apex court has held that the main eligibility condition for the scheme was t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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