Subsidy received under Industrial Promotion scheme is with an intent of promotion and incentivising specific lines of business. The Purpose test elaborated under the Apex Court decision in Ponni Sugar was applied to consider/classify the subsidy as a capital receipt. (AY. 2013-14)
Mahindra Two Wheelers Ltd. v. Dy. CIT (2022) 219 TTJ 136 / 218 DTR 210 / 140 taxmann.com 367 (Mum.)(Trib.)
S. 4 : Charge of income-tax-Subsidy-Industrial promotion scheme-Capital receipt. [S. 28(i)]