ISSUE:
Whether the recipient's entertainment duty subsidy intended for regular usage, like recurring revenue or spending, or was it designed for a particular use, like encouraging the development of multiplex theatres?
Whether the court required to decide whether or not the tax treatment of the subsidy should take into account the principal objective of its grant, regardless of the source of funds utilized for construction or the time when the money was received?
RULE:
A subsidy's classification as revenue or capital for tax purposes depends on why the government provided it. Regardless of where the funds came from or when they were received, a subsidy is deemed capital when the government's primary goal is to support the launch of a new project or the material expansion of an existing one.