https://www.taxtmi.com/caselaws?id=353779 The ITAT was justified in deleting the addition made by the AO regarding the disallowance of VAT reimbursement claims by the assessee. The Tribunal determined that the VAT subsidy received was a capital receipt under the Industrial Incentive Policy of Bihar, aimed at creating new assets and employment opportunities. Citing relevant case law, including *Commissioner of Income Tax, Madras vs. Ponni Sugars and Chemicals Ltd.*, the Tribunal applied the purpose test to conclude that the subsidy was not chargeable to tax. The Tribunal's decision was upheld, dismissing the department's appeal in favor of the assessee. en-us Tue, 02 Jan 2018 00:00:00 +0530 Fri, 16 Feb 2018 15:05:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=353779 The ITAT was justified in deleting the addition made by the AO regarding the disallowance of VAT reimbursement claims by the assessee. The Tribunal determined that the VAT subsidy received was a capital receipt under the Industrial Incentive Policy of Bihar, aimed at creating new assets and employment opportunities. Citing relevant case law, including *Commissioner of Income Tax, Madras vs. Ponni Sugars and Chemicals Ltd.*, the Tribunal applied the purpose test to conclude that the subsidy was not chargeable to tax. The Tribunal's decision was upheld, dismissing the department's appeal in favor of the assessee. Case-Laws Income Tax Tue, 02 Jan 2018 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=353779