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TMI Blog1995 (1) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... tax Act, 1961 ? 2. Whether, on the facts and in the circumstances of the case and in law, the Tribunal was right in holding that the sum of Rs. 2,08,003 being the conditional subsidy received from the Rajasthan Government under the subsidised housing scheme for industrial workers did not form part of the ' actual cost ' of the labour colony under section 43(1) and, consequently, the assessee-company was not entitled to get deduction for depreciation of Rs. 4,342 on the said amount under section 32 of the Income-tax Act ? " R. A. No. 14 " 1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the surtax payable by the assessee-company was not allowable as deduction in computing the total i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r colony under section 43(1) and, consequently, the assessee-company was not entitled to get deduction for depreciation of Rs. 4,233 on the said amount under section 32 of the Income-tax Act. Learned counsel for the assessee has placed reliance on the decision given by the apex court in CIT v. P. J. Chemicals Ltd. [1994] 210 ITR 830 and the decision given by this court in the case of CIT v. Ambica Electrolytic Capacitors P. Ltd. [1991] 191 ITR 494. We have gone through those judgments as welt. The word " actual cost " which was interpreted by this court as well as the apex court was considered not to include the subsidy which is introduced as an incentive. The subsidy so given was found not to be a payment directly or indirectly to meet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ectly by any other person or authority. The State Government which has given the subsidy has met the cost directly of the asset and, therefore, in view of the definition of " actual cost " and the decisions given by this court in the case of the assessee, we are of the opinion that the Income-tax Appellate Tribunal was justified in holding that the sum of Rs. 2,08,003 being conditional subsidy received from the Rajasthan Government under the subsidised housing scheme for industrial workers did not form part of the " actual cost " of the labour colony under section 43(1) and, consequently, the assessee-company was not entitled to get deduction for depreciation on the said amount under section 32 of the Act. The reference is accordingly ans ..... X X X X Extracts X X X X X X X X Extracts X X X X
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