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2017 (8) TMI 315 - ITAT CHENNAIAssessment of the bank interest under the head "Income from other Sources" - interest on Bank fixed deposits provided as Bank guarantee on EPGS scheme for the purpose of import of capital goods - Held that:- Delhi High Court in the case of Pr. CIT Vs Facor Power Ltd.(2016 (1) TMI 461 - DELHI HIGH COURT ), it was held that where assessee is engaged in generating electric power, kept margin money in the form of fixed deposits for procurement of various capital goods for setting up the power project, interest earned on fixed deposits would be in nature of capital receipt, not liable to tax. The assessee company had made fixed deposits to procure capital goods for project as per terms of EPCG Scheme Interest on fixed deposits in providing bank Guarantee under EPCG scheme is in the nature of capital receipt and to be set off against project cost and Accordingly we direct the Assessing Officer to delete the addition and allow the ground of the assessee.
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