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Section 4 of the Income-tax Act, 1961 - Income - Chargeable as Power subsidy received from Electricity Board is a revenue receipt. [A/Y 1993-94] In view of the of the Supreme Court CIT v. Rajaram Maize Products [2001] 251 ITR 427, power subsidy received from the Electricity Board is a revenue receipt. Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowability of 'Front end fee' paid by assessee in respect of loan borrowed for expansion of a unit was allowable as revenue expenditure Where during the year of account the assessee obtained sanction for a term loan of Rs. 820 lakhs from the IDBI and while availing of the above loan, the assessee incurred an sum of Rs. 8.20 lakhs towards "front end fee payment" at the rate of 1 per cent on the loan amount: Held that without paying the above said amount, the IDBI might not have sanctioned the loan amount for setting up the new unit. Here the amount was paid only for obtaining the loan and, hence, the same did not bring into existence any asset of an enduring nature. If interest paid on borrowed amount could be held to be revenue expenditure, one failed to see how the present amount incurred for obtaining a loan for setting up of a new unit, could be regarded as capital payment. It was the condition precedent for obtaining the loan and also it was in the nature of processing fees for the bank to release the loan incurred for the purpose of the business and, hence, the same was only revenue expenditure. The Tribunal correctly followed the principle enunciated in the reported in CIT v. Sivakami Mills Ltd. [1997] 227 ITR 465 (SC) and decided the case in favour of the assessee. JUDGMENT P.P.S. Janarthana Raja, J.-The Revenue has filed this appeal under section 260A of the Income-tax Act, 1961, against the order dated November 28, 2002, made in I.T.A. No. 936(Mds)/97 on the file of the Income-tax Appellate Tribunal, Madras. When the appeal came up for hearing, this court has admitted the same on the following substantial questions of law : "(i)Whether, on the facts and circumstances of the case, the Tribunal was right in law in holding that the power subsidy received from the electricity board should be…

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