TMI Blog2011 (7) TMI 358X X X X Extracts X X X X X X X X Extracts X X X X ..... estions are concerned. As regards the assessment year 1999-2000, in respect of the assessee as to whether the interest earned from the advances should be assessed under the head of "income from other sources", the Tribunal gave a finding that the interest income was earned on advances given out of surplus funds which was not in the ordinary course of business. Going by the said finding, in the absence of any other material to substantiate that the assesseee was not doing money lending business also, we have no hesitation in confirming the view of the Tribunal. - 303 to 305 of 2005 - - - Dated:- 27-7-2011 - MRS.JUSTICE CHITRA VENKATARAMAN, MR.JUSTICE M.JAICHANDREN, JJ. For Appellant: Mr.R.Venkatanarayanan for M/s.Subbaraya Aiyer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the same has to be treated, as "income from business". Hence, it could not be treated as "income from other sources". The Assessing Officer, as well as the Commissioner of Appeals, rejected the plea of the assessee. 6. On an appeal before the Tribunal, it was pointed out that the interest received on short term deposits though could be attributed to the business, could not be treated as an "income derived from business". The assessee contended that the said fixed deposits were made for the purpose of opening of Letter of Credit and for the other benefits which are necessarily required for export business. The Tribunal pointed out to the correspondence with the bank and stated that that there was no compulsion at all or insistence fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e given to the interest received was considered, applying Clause (baa) of the Explanation to Section 80HHC of the Income Tax Act, 1961, this Court held that the interest received though includable in the gross total income of the assessee, yet for the purposes of Clause (baa) of the Explanation to Section 80HHC of the Income Tax Act, 1961, there would be an exclusion of 90% of the interest income, while calculating the deduction under 80HHC of the Act. 10. Applying the said decision to the facts herein, it is clear that the interest income earned on the Fixed deposits, treated as income from other sources, hence, needs to be considered in the calculation to be done in accordance with Clause (baa) of the Explanation to Section 80HHC of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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