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TMI Blog2010 (10) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... xcluded from the cost of the assets for the depreciation and made an addition after re-working the same - CIT(A) upheld the action of the A.O. HELD THAT:- An identical issue was raised under similar material facts in the case of M/s. Sapna Re-rolling Industries v. ITO wherein following the decision of the Tribunal in the case of Sasisri Extractions Ltd. v. ACIT,[ 2008 (1) TMI 485 - ITAT VISAKHAPATNAM] , held that; A careful perusal of Target 2000 scheme shows that the scheme was intended to accelerate industrial development of the State and the incentive was given for setting up of determining the amount of subsidy to be given the cost of eligible investment was taken as the basis, though it was not specifically intended to subsidi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10 ITR 830 (SC) 2) Sahaney Steel and Press Work Ltd. V/s. CIT, 142 CTR (SC) 261 3) CIT V/s. K.C.A. Lt.(2005), 198 CTR (Bom) 331 4) CIT V/s. Sterlite Chemical (2008), 166 Taxman 57 (Delhi) 5) CIT V/s. Eggro Paper Moulds Ltd. (2006), 152 Taxman 214(All.) 3. The Ld. D.R., on the other hand, tried to justify the orders of the lower authorities. He submitted that in view of Explanation-10 to Section 43(1) of the Act, any subsidy by whatever name called received from the Government is required to be reduced from the actual cost of assets for the purpose of depreciation under the Income Tax Act 1961. 4. We have heard and considered the arguments advanced by the parties in view of the orders of the lower authorities, material avai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acturing of M.S. Bars. In the A.Y. 2002-03, the assessee received an amount of ₹ 6,50,871/- as State Government subsidy, which the assessee directly transferred to Reserves Surplus. The A.O was, however, of the view that the subsidy was capital in nature and accordingly, the same should have been reduced from the cost of assets in terms of Explanation-10 to Sec. 43(1) of the Act. The Tribunal observed that subsidy in question is not an asset specific subsidy but a general subsidy for location of industrial unit in backward areas. The Tribunal, thereafter, following the decision of Visakhapatnam Bench of the Tribunal in the case of Sasisri Extractions Ltd. V. ACIT (supra) has decided the issue in favour of the assessee. The relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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