ITAT Classifies Sales Tax Subsidy Under Backward Area Development Scheme as Capital Receipt Excluding It from US-115JB Computation

The Income Tax Appellate Tribunal (ITAT) held that sales tax subsidies received under backward area development schemes qualify as capital receipts, thereby excluding them from the computation of book profits under Section 115JB (Minimum Alternate Tax). The ruling clarifies tax treatment of subsidies enhancing capital assets or business capacity, distinguishing them from revenue receipts. This provides tax relief to businesses undertaking development activities in backward regions, encouraging regional economic growth through clarified subsidy taxation.