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2019 (12) TMI 257 - ITAT CHENNAIAppropriate head for taxability of income - interest on short term deposits made from borrowings - interest on deposits placed as margin money for letter of credit and bank guarantee - assessable under the head income from other sources or not - HELD THAT:- In the case of Autokast Ltd., supra, it was observed that the interest income on money borrowed for purchase of plant and machinery and placed in short term deposit in bank till payment was made and used in bill discounting was taxable as ‘income from other sources’. Deduction of interest - case of assessee is that the interest paid on borrowings should be deducted as an expenditure U/s.57 from the interest income as it was incurred wholly for earning such interest income - HELD THAT:- There are merits in the grounds raised by the assessee - the issue is remanded back to the Assessing Officer to verify and assess the net interest income. The appeal of the assessee is treated as partly allowed for statistical purpose.
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