COMMISSIONER OF INCOME TAX Vs. KIRAN ENTERPRISES

JUDGEMENT

(1.) THIS appeal was admitted on the following substantial questions of law:

(2.) IT would be pertinent to mention that we are concerned with the assessment relating to the year 2001 2002 and therefore Section 80 -1A was applicable at the relevant time. The relevant portion of the Section reads as follows:

(3.) IN the State of Himachal Pradesh there is scarcity of rail net work. A scheme has been framed by the Central Government whereby freight/transport subsidy is provided to the industries set -up in remote areas where rail facilities are not available and some percentage of the transport expenses incurred by the industrial undertakings to transport raw material to the factory and to transport finished goods from their industries is subsidized by the Central Government. The question which arises is whether this freight subsidy is income derived from the business of the industrial undertaking and can be included in the profits eligible for deduction under Section 80 -1A.