“Section 273(2)”

Interest, sales tax, and purchase tax subsidies received by an assessee are generally considered capital receipts, not revenue income, for income tax purposes.

The case is cited for the principle that when a payment is made for a non-compete agreement which is part of a larger business transfer, the characterisation of the payment depends on whether it is for the enduring benefit of the business or for the loss of potential profits.

The Commissioner of Income Tax (CIT) cannot direct the Assessing Officer (AO) to initiate penalty proceedings under Section 271(1)(c) in exercise of revisional power under Section 263 of the Act, if the AO had not initiated such proceedings in the assessment order.

The Commissioner cannot direct the Assessing Officer to initiate penalty proceedings under Section 271(1)(c) if the Assessing Officer did not initiate them in the assessment order, when exercising revisional powers under Section 263.

Revisionary powers under section 263 cannot be invoked solely to direct the initiation of penalty proceedings.

The Commissioner of Income Tax (CIT) cannot direct the Assessing Officer to initiate penalty proceedings under section 271(1)(a) or section 273(2)(c) while exercising powers under section 263, as the CIT himself is not empowered to record the satisfaction for such penalties.

Section 292BB of the Income Tax Act, introduced by the Finance Act, 2008, has prospective effect and does not apply retrospectively.