Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2012 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (7) TMI 408 - ITAT, DELHICommencement of business activity - Denial of assessee’s claim of interest expenses u/s 36(1)(iii) as business of the assessee was yet in the process of being set up - CIT(A)allowed the claim - Held that:- The main activity of the assessee company is to finance the project through special purpose vehicles to other local companies for buying land more than 100 acres or bringing other licenses from the Government Departments and the assessee had entered into a joint construction and development agreement with two more companies which was in the process of acquiring land and government approvals, the sequence of events suggest that assessee has taken active steps in accordance with its Memorandum and Article of Association warranting that the business has been set up - in favour of assessee. Treatment of interest income received from short term fixed deposits - income from other sources or income from business - Held that:- The assessee has not demonstrated as to how it has undertaken the business of lending money in an organized manner which can suggest interest income from a business activity. It has simply surplus funds which were deposited in the fixed deposit during the period when such funds were not required - against assessee.
|