TMI Blog2010 (2) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... interest received on inter-corporate deposits – held that - Interest is not eligible for deduction uner section 80 I – decision in the matter of Commissioner of Income-tax v. Sriram Honda Power [2008 -TMI - 2891 - HIGH COURT, DELHI] followed. – the expenditure directly connected with the purchase of the plant and machinery and, therefore, the same was to be treated as capital expenditure – additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion claimed by the assessee under Section 80-I of the Income-tax Act, 1961 (hereinafter referred to as 'the said Act') on interest received on letters of credit and bank guarantee money. A similar claim has been made by the assessee in respect of the interest earned on deposits, under sales tax rules, in Kisan Vikas Patras, interest received on income-tax refund as also the interest received on i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure' and disallowed the same. This was upheld by the Commissioner of Income-tax (Appeals) as well as by the Income-tax Appellate Tribunal. The Tribunal held the said expenditure to be directly connected with the purchase of the plant and machinery and, therefore, the same was to be treated as capital expenditure. We see no reason to interfere with this finding. 3. The third issue sought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correct. The Tribunal, however, went further to observe that as the said amount of Rs 51,06,391/- was also loaded on the closing stock of the year in question, the opening stock of the succeeding year would have to be reduced so as to avoid a double deduction. 4. The learned counsel for the appellant submitted that a rectification application had been moved before the Tribunal being M.A. No.404 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stock of the succeeding year. We feel that this aspect of the matter can be adequately addressed by directing the Assessing Officer to verify as to whether the said amount of excise duty paid during the year had been loaded on the closing stock or not. In case it was loaded, then the observations of the Tribunal would stand. However, if it was not so loaded, then there would be no need for reduci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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