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Judgment
Leave granted in the special leave petition.
The question that requires our consideration reads thus (see Commissioner of Income Tax Vs. Rajaram Maize Products, :
"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the power subsidy received by the assessee was a capital receipt, not liable to be taxed within the meaning of section 28(iv) of the income tax Act. 1961 ?"
This court in M/s. Sahney Steel and Press Works Ltd., Hyderabad etc. etc. Vs. Commissioner of Income Tax, Andhra Pradesh-I, Hyderabad, , has held that power subsidies are of revenue nature and have to be taxed accordingly. We also find that the terms under which the subsidy was given in the present cases clearly suggest that the subsidy was of a revenue nature inasmuch as it went towards reduction of the electricity bills.
Accordingly, the appeals are allowed. The orders under challenge are set aside in so far as they relate to the question quoted above. That question is answered in the negative and in favour of the Revenue.
No order as to costs.