NATURE OF SUBSIDY ::

Last updated: 28 August 2007

Court :
TRIBUNAL

Brief :
Purpose of the Subsidy is important to determine whether it is revenue or capital

Citation :
JCIT Vs Swastika Agroils P. Ltd

Nature of Subsidy J.C.I.T Vs. Swastika Agroils (P.) Ltd. IT APPEAL NO. 426 (CHD.) OF 2000 Case Fact: Whether A.O. is justified in treating govt. subsidy as revenue receipt on ground that such subsidy was to be received only after 60 days of commencement of business. Decision: Held that since subsidy was granted for setting up industry and to meet cost of capital expenditure, it was a capital subsidy. Hence, A.O. is not justified in treating subsidy as revenue receipt merely because it was to be received after 60 days of commencement of business.