1995 (4) TMI 21

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....e following two questions of law arising out of its order dated December 19, 1988, in respect of the assessment year 1982-83 under section 256(1) of the Income-tax Act, 1961 : " Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in : (a) holding that cash compensatory support for export is not taxable as revenue receipt ? (b) holding that....

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....al, it was contended that the cash compensatory support for export is not a revenue receipt and is accordingly not taxable. We have considered over the matter. The amount which has been received by the assessee is during the course of conducting his business and is directly proportionate to the actual exports made. The cash assistance sprang from the business carried on by the assessee and is an ....

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....ides the definition of income under section 2(24) was amended by the Finance Act, 1990, wherein profits on sale of import licences, cash assistance and draw back on customs or excise duty have been included within the definition of income. In respect of cash assistance, sub-clause (vb) was added from April 1, 1967, which provided "any sum chargeable to income-tax under clause (iiib) of section 28"....

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....n of the apex court in the case of CIT v. P. J. Chemicals Ltd. [1994] 210 ITR 830, wherein it was observed (at page 841) : " The expression 'actual cost' needs to be interpreted liberally. The subsidy of the nature we are concerned with, does not partake of the incidents which attract the conditions for their deductibility from 'actual cost'. The Government subsidy, it is not unreasonable to say....