Capital or Revenue receipts

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 May 2010 Dear Freinds

Interest and Wage Employment Susidy received from Govt. is a CAPITAL Receipts or REVENUE Receipts. The above subsidy amount is based on Interest and Wages paid during the year.

My question is whether the above susidy is taxable in hands of assessee. Pls also give any judgement or case law on the above

Thanks

CA. B.SRINIVASULU

CA. B.SRINIVASULU (Expert)
Follow

29 May 2010 Since you are getting reimbursement of wages and interest which is an expenditure the subsidy should be treated as income.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
Follow

29 May 2010 It is a revenue receipt and taxable under the Income tax Act,1961.

Citation:-
Sahney Steel and Press Works Ltd.
Vs.
Commissioner of Income-tax [1997] 228 ITR 253 (SC)

Upgrade to CAclubindia Pro. Subscribe Now!