https://www.taxtmi.com/caselaws?id=5620 The dominant issue was whether the subsidy/incentives received from a State Government by a newly established industrial undertaking constituted a capital receipt or a revenue receipt chargeable to tax. Applying the principle that payments from public funds made to assist an assessee in carrying on trade and to make the business more profitable are revenue in character, the SC held that the scheme's object was to provide post-commencement assistance for five years to help the undertaking operate profitably and competitively, not to finance its setting up. The SC rejected the contrary HC view that treated similar refunds as capital incentives, noting that eligibility arose only after production commenced. The appeal was dismissed and the subsidy was held taxable as revenue receipt. en-us Fri, 19 Sep 1997 00:00:00 +0530 Tue, 23 Dec 2025 11:12:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=5620 The dominant issue was whether the subsidy/incentives received from a State Government by a newly established industrial undertaking constituted a capital receipt or a revenue receipt chargeable to tax. Applying the principle that payments from public funds made to assist an assessee in carrying on trade and to make the business more profitable are revenue in character, the SC held that the scheme's object was to provide post-commencement assistance for five years to help the undertaking operate profitably and competitively, not to finance its setting up. The SC rejected the contrary HC view that treated similar refunds as capital incentives, noting that eligibility arose only after production commenced. The appeal was dismissed and the subsidy was held taxable as revenue receipt. Case-Laws Income Tax Fri, 19 Sep 1997 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=5620