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2014 (8) TMI 959 - ITAT MUMBAIDeduction u/s 80-IAB - Inclusion of interest in claim of Section 80IAB - interest received by the assessee on advances made by it to its various contractors who are engaged in infrastructure work - Held that:- an identical issue has been considered by the Hon’ble Gujarat High Court in the case of Nirma Industries, [2006 (2) TMI 92 - GUJARAT High Court] where the Hon’ble Gujarat High Court has held that the interest received on delayed payment by the debtor is to be included in the profit of the industrial undertaking. In the case in hand, there is no dispute that the assessee has received interest from advances made by it to its contractors engaged in infrastructure work, therefore, the interest received by the assessee has to be considered as interest derived from industrial undertaking eligible for deduction u/s 80-IAB of the Act. To sum up, interest amounting to ₹ 2,92,88,967/- being interest on advances to contractors is to be taxed under the head “business income” and interest of ₹ 3,93,27,585/- being interest on FDR has to be decided afresh - Decided in favour of assessee.
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