Rajesh Bindal, J.

1. The Revenue has filed the present appeal against order dated 27.2.2004, passed by the Income-tax Appellate Tribunal, Chandigarh Bench `A (for short, `the Tribunal) in I.T.A. No. 1017/CHANDI/97 for the assessment year 1993-94, raising the following substantial questions of law:

(i) Whether on the facts and circumstances of the case, the Hon ble Income Tax Appellate Tribunal was right in deleting the disallowance of Rs. 16,48,024/- made on account of interest on interest free advances given to the sister concern for non-business purpose ?

(ii) Whether on the facts and circumstances of the case, the Hon ble Income-tax Appellate Tribunal was right in law in deleting the addition on account of sales tax subsidy of Rs. 4,56,948/- claimed by the assessee as capital receipt instead of revenue receipt ?

2. The appeal is admitted for consideration of substantial questions of law, referred to above.

3. With the consent of learned Counsel for the parties, we have taken the appeal on Board and heard the same for final disposal.

4. More than two decades ago, a Constitution Bench of Hon ble the Supreme Court in McDowell & Company Limited V. Commercial Tax Officer, whi