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2004 (11) TMI 77 - HC - Income TaxAssessee earned interest income from investments and incurred that interest for the maintenance of office and for the planning of construction, etc. - Income-tax Officer did not allow any expense out of interest income as there was no business done - However, the Commissioner of Income-tax (Appeals) allowed expenses at the rate of 1 per cent. of the interest income. In the second appeal the Income-tax Appellate Tribunal has enhanced it from 1 per cent. to 5 per cent - If a particular expenditure falls strictly under the clause of section 57 of the Act only then it is liable to be allowed as expenses otherwise not. The expenditure incurred on maintenance of the office and for planning of construction does not fall under any of the clauses of section 57 of the Act and therefore the assessee could not have been allowed the expenses as deduction from the interest income – Hence Tribunal was not legally justified in allowing various expenses against the income from other sources - Tribunal had erred in allowing an exclusion of 5 per cent. on estimate basis
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