COMMISSIONER OF INCOME TAX Vs. SHAJAHAN M

JUDGEMENT

(1.) THE Revenue expects an answer from us to the following question :

(2.) THE assessment year is 1979-80 which ended on March 31, 1979. THE original assessment was completed under Section 143(1) on September 24, 1979. THEreafter, the Income-tax Officer noticing that the assessee had received a sum of Rs. 9,502 as subsidy from the Rubber Board reopened the assessment and the amount of Rs. 9,502 came to be subjected to tax on the ground that it was a revenue receipt. This was by an order dated September 14, 1981 (annexure "A"). THE first appellate authority--the Appellate Assistant Commissioner allowed the appeal by the order dated March 10, 1983, and deleted the addition of Rs. 9,502. THE first appellate authority had placed reliance on the decision of the Tribunal in I. T. A. No. 193/(Coch) of 1980.

(3.) THE reasoning of the Division Bench in CIT v. Malayalam Plantations Ltd. [1987] 168 ITR 63 is also taken up for consideration when the Division Bench referred to Section 10(30) of the Act allowing exclusion of subsidy for tea plantation for the computation of total income. In this connection, the Full Bench has observed that it has to be noted that a percentage of income from the profits earned from the business of growing and manufacturing tea in India is an income under the Income-tax Act, but the profits earned by the business of growing rubber is not an income under the Income-tax Act because now it has to be noted that Section 10(31) has been inserted by the Finance Act, 1988, with effect from April 1, 1989, to exclude the amount of subsidy received from the Rubber Board from the computation of the total income of the assessee.