treatment of agricultural loan interest subsidy

The Finance Bill, 2015, as passed by Lok Sabha on 30th April has specified that subsidies no longer would be treated as capital gains, but as income (revenue receipt).

The amendment in the definition of 'Income' under Section 2(24) in the Finance Bill, 2015, says, 

"A new sub-clause (xviii) is proposed to be inserted in Section 2(24) to provide that assistance in the form of a subsidy or grant or cash incentive or duty drawback or waiver or concession or reimbursement (by whatever name called) by the Central Government or a State Government or any authority or body or agency in cash or kind to the assessee [other than one considered under Explanation 10 to Section 43(1)] would be included in assessee's income."

Thus, any subsidy which is not reduced from the actual cost of the asset in view of provisions of Explanation 10 to Section 43(1) shall be taxable as revenue receipts of the assessee.

if Govt intentions are to exempt the subsidy and other welfare subsidies then They should come with a clear cut clarification.

#Be Specific with your problem and write in details to assist in answering your query.

Hope this helps

Thank you