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2009 (7) TMI 862 - ITAT, PUNEDeduction under section 80HHC - Once it is not in dispute that interest is received on the loans given to the employees it is difficult (sic) to come to the conclusion that such interest earning is nothing but a receipt in the course of normal business; it is a normal commercial practice to grant loans to the employees from time to time and any interest that the business concern earns on such loan cannot be an independent source of income in character - There are large number of decisions of this Tribunal holding that interest earned on advances to the employees is to be treated as integral part of business income - the interest earned on loans ought to have been treated as part of the business income for the purposes of computation of deduction under section 80HHC of the Act - Direct the Assessing Officer to modify the claim of deduction under section 80HHC of the Act.
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