( 1 ) IN IT Ref. No. 46 of 1995 the Tribunal, Allahabad, has referred the following question of law under Section 256 (1) of the IT Act, 1961, hereinafter referred to as the Act, for opinion to this court :

"whether, in the facts and circumstances of the case, the Tribunal was justified in law in holding that the grant-in-aid of Rs. 3,06,711 received by the assessee under the scheme of State of U. P. introduced with the object to promote the construction of permanent cinema buildings in the backward areas as revenue receipt in the hands of the assessee ?"

( 2 ) IN the IT Appeal No. 5 of 2001, the appellant had raised five questions of law which, according to it, are substantial questions of law. However, the decision on the question referred by the Tribunal under Section 256 (1) of the Act would also decide the aforementioned IT appeal. The reference and the appeal, as they raise a common question of law, have been heard together and are being decided by a common judgment.

( 3 ) FOR the sake of brevity, the facts of the IT Ref. No. 46 of 1995 are given below : the applicant is a registered partnership firm and is engaged in the business of cinema exhibition. During