Assessee received interest subsidy from Rajasthan Govt. and disclosed the same as capital reserve in its balance sheet. Ld. AO treated it as revenue receipt. CIT (A) confirmed the contention of the assessee following earlier years order. On further appeal, the Tribunal observed that in Sahney Steel & Pressing Works Ltd. v. CIT(1997) 228 ITR 253 (SC), the Supreme court held that subsidy given to the new industries at the commencement of business, to carry on their business and not as an aid for setting up of the industries that subsidy is treated as operational subsidy and not a capital one. With regard to revenue subsidy, it held that if it is given by way of assistance to carry on trade or business, it has to be treated as a trading receipt. The Tribunal observed that in the present case, the interest subsidy was given only for the payment of loan acquired for acquisition of capital assets. As such, it is a subsidy given for setting up of business. Hence, it has rightly been treated as a capital receipt. (ITA No. 15/LKW/2018,  dt. 07.12.2018) ( AY. 2012-13)