2017 (4) TMI 185 - BOMBAY HIGH COURT

Addition u/s 68 - Held that:- Revenue states that the impugned order itself holds that share premium of ₹ 490 per share defies all commercial prudence. Therefore it has to be considered to be cash credit. We find that the Tribunal has examined the case of the Revenue on the parameters of section 68 of the Act and found on facts that it is not so hit. Therefore, section 68 of the Act cannot be invoked. The Revenue has not been able to show in any manner the factual finding recorded by the Tribunal is perverse in any manner.- Decided against revneue

Interest income from fixed deposit chargeable as business income - assessee's subsidiary company has started manufacturing - Held that:- The business of the respondent- assessee was of financing, investing, sourcing, operating, green or clean technological products and services had commenced. Therefore, consequently, allowed the claim made for depreciation and expenses to deter mine business profits. The above finding of the Tribunal that the business of the respondent had commenced is not challenged before us by the Revenue. It needs no emphasis that setting up a business or commencement of business cannot vary dependent upon the claim being made, i.e., for expenses it has commenced and for income it has not commenced. Therefore it is not open to the Revenue to contend that the business was not set up/commenced for the purposes of holding that the income earned is not income from business.

Further the respondent's business and the period of fixed deposits, the impugned order holds the interest earned on them is taxable as business income. In fact this court is almost similar circumstances in Indo Swiss Jewels Ltd. (2005 (9) TMI 47 - BOMBAY High Court ) has held interest earned on short- term deposits on the money kept apart for the purposes of business had to be treated as income earned from business and could not be treated as income from other sources. Considering the short duration in which the amounts were kept in fixed deposit awaiting use in its business operations would necessarily mean income earned on account of business following the ratio of this court in Indo Swiss Jewels Ltd. (2005 (9) TMI 47 - BOMBAY High Court ). - Decided against revneue