Description:
In sasisri Extractions Ltd. V. ACIT [2009] 25 [II] ITCL 541 (Vishakhapatnam Trib) : (2008) 307 ITR (AT) 127 (Vishakhapatnam-Trib), (2010) 122 ITD 428 (Vishakhapatnam-Trib),
The Tribunal found from the scheme that the subsidy in question not be intended to accelerate industrial development of state and for the purpose of determining the amount of subsidy to be given, cost of eligible investment was taken as the basis, though it was not specifically intended to subsidise the cost of the capital assets.
Therefore, for the purpose of computing depreciation allowable to the assessee, the subsidy amount could not be reduced from the cost of the capital asset.
Source:
1. www.tpcc.in
2. The Tax Referencer .Volume117. Issue No.3 17 January 2011 Page No.40.
Our Comment:
Subsidy cannot be reduced from the cost if the govt. Grants subsidy based on capital introduced when there is no provision for providing the capital assets on subsides prices.
