Capital Subsidy should be reduced for Computation of Book Profit u/s 115JB of Income Tax Act: ITAT

The Income Tax Appellate Tribunal (ITAT) ruled that capital subsidy should be reduced for the computation of book profit under Section 115JB of the Income Tax Act. The case involved a taxpayer who had received a capital subsidy, which the Assessing Officer included in the computation of book profit. The ITAT found that the subsidy should be excluded from the book profit calculation, as it was a capital receipt. This decision provides clarity on the treatment of capital subsidies in the computation of book profit and reinforces the principle that capital receipts should not be included in taxable income.