JUDGMENT K.L. Manjunath, J.— The respondent-assessee for the assessment year 1994-96 had received a sum of Rs. 3,73,000/- as A subsidy granted by the State to encourage a Hotel Industry set rap by tire assessee. The assessee for the assessment year 1954-95 claimed the said amount of subsidy towards the capital investment, which was disallowed by the asset assessing officer. Being aggrieved by the same, the assessee filed an appeal before the Commissioner of Income lax (Appeals) which appeal came to be allowed holding that the subsidy baa been granted to the assesses by the State as peer 1982-87/86 package of incentives and concessions and held that it is towards investment and not a revenue receipt Accordingly, the appeal came to be allowed. 2. Being aggrieved by the order of Commissioner of Income Tax (Appeals), the revenue filed the Income Tax Appellate Tribunal, Bangalore in ITA No. 787/Bangelore/03 which appeal came to be dismissed confirming the order passed by the Commissioner of Income Tax (Appeals). 3. Being aggrieved by the concurrent findings, the revenue has come up in this appeal before this Court raising the following substantial questions of law: 1) Whether the Appellate Authorities were correct in holding that the finding of the Assessing Officer that the subsidy of Rs. 3,73,000/-received by the assessee from the State Government and utilized for carrying on its business cannot be treated as a revenue receipt despite law declared by the Apex Court in M/s. Sahney Steel and Press Works Ltd., Hyderabad etc. etc. Vs. Commissioner of Income Tax, Andhra Pradesh-I, Hyderabad, AIR 1997 SC 3968 which clearly held that such subsidy issued is treated as revenue receipt. 2) Whether the Appellate Authorities were correct in holding that the subsidy received should be treated as a capital receipt not liable to tax despite the assesses admitting that it was not utilised to purchase any capital asset. 4. We have heard the learned Counsel for the parties. 5. Learned Counsel for the Revenue relying upon the judgement of the Supreme Court in M/s. Sahney Steel and Press Works Ltd., Hyderabad etc. Vs. Commissioner of Income Tax, Andhra Pradesh-I, Hyderabad, AIR 1997 SC 3968 contends that when the subsidy amount of Rs. 4. We have heard the learned Counsel for the parties. 5. Learned Counsel for the Revenue relying upon the judgement of the Supreme Court in M/s. Sahney Steel and Press Works Ltd., Hyderabad etc. Vs. Commissioner of Income Tax, Andhra Pradesh-I, Hyderabad, AIR 1997 SC 3968 contends that when the subsidy amount of Rs. 3,73,000/- is received by the assessee alter completion of the hotel project and commencing of the business, such receipt has to be taken as revenue receipt and not a capital investment Therefore, he requests the Court to set aside the order passed by the authorities below and allow the appeal. 6. Par contra, learned Counsel for the assessee contends that the facts involved in the present case and the facts involved in the judgment relied upon by the revenue are totally different According to him in the case of Sahney Steel Works Limited, the Government was refunding the sales tax on the purchase of machinery etc. after commencement of production to enable the assessee to run the business more profitably. Therefore, the Hon'ble Supreme Court has taken such a decision. According to him, in the present case, based on the subsidy announced by the State Government to encourage the tourism, the hotel industry was established by the assessee and the Government based on the budgetary allocation used to release the subsidy amount in the subsequent years. Therefore, he contends that the facts involved in the present case and the judgment, relied upon by the revenue has no application. 7. Having heard the learned Counsel for the parties, what is required to be considered by the Court in this appeal is: 8. whether the decision relied upon by the revenue of this case? 9. Admittedly, the subsidy has been announced by the State of Karnataka to encourage the hotel industry and the State is in the habit of releasing subsidy amount depending upon the budgetary allocation in each year. This Court has come across in several oases that the State has released subsidy amount even after ten years of the commencement of the project. Therefore, the contention of the revenue cannot be accepted. 10. In the result, the questions of law framed in the present case are answered against the revenue. Accordingly, the appeal is dismissed.