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2015 (10) TMI 1740 - PUNJAB & HARYANA HIGH COURTTreatment to interest income - business income or income from other sources - adjust B/F losses related to against interest Income denied by AO - ITAT allowed assessee claim - Held that:- Where the assessee is regularly engaged in money lending business and is earning interest therefrom, interest income is to be taxable under the head "business income", regardless of the fact that the assessee has obtained any licence for such money lending business or not. For this proposition, we are fortified by the decision in the case of Smt. Gulab Sundari Bapana vs. DCIT (2000 (9) TMI 219 - ITAT DELHI-D) and in the case of Loka Shikshana Trust vs. CIT (1975 (8) TMI 1 - SUPREME Court), wherein the Hon'ble Apex Court held that the regular course of dealing in money lending could not be brushed aside merely for the reason that the assessee was not having any money lending licence. In that case, the assessee entered into number of transactions over the year and earned interest on loans and advances given in the ordinary course of its activities. The Hon'ble Apex Court held that "absence of money lending licence is not so crucial for the purpose of Income Tax Act, if the nature of activity undertaken by the assessee can be decided on the basis of other facts." Admittedly, the assessee was engaged in granting of loans on regular basis and interest income was shown as business income, also attained finality on identical fact in earlier assessment year and accepted by the department as business income, the department is not justified in diverting from its earlier stand in the impugned assessment year. This ground of the revenue therefore, is having no merit. Once it has been held that the income of the assessee was to be assessed under the head income from business or profession, the assessee was entitled for set off against carry forward losses. The Tribunal was thus justified in allowing the same. - Decided in favour of assessee.
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