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2017 (4) TMI 1313 - AT - Income TaxDeduction u/s 80IB - process of manufacturing of poultry feeds - whether assessee is engaged in the manufacture of a production of an article so that it may be eligible for deduction u/s 80IB? - Held that:- The assessee's eligible undertaking itself was independently carrying out the complete activity i.e. from mixing, grinding till the pelletisation. The raw materials once consumed could not be reconverted into the same position. Its utility gets changed. The prime raw materials such as, maize, soya oil, rice bran, etc. can no more be regarded to be the rice bran, soya oil, maize. Respectfully following the decision of the Coordinate Bench of this Tribunal in assessee's own case the finding of CIT(A) on this issue stands confirmed and the grounds of appeal raised by the Revenue in all the appeals on this issue are dismissed Interest on fixed deposits - AO held that deduction u/s 80IB(5) of the Act is to be allowed only on “profits derived” from the eligible business which clearly indicated that there should be a direct or immediate nexus between the income and business of the assessee - Held that:- The interest income and the interest expenses had a direct nexus and therefore netting of interest income against the interest expenses had to be allowed. Since the interest expenses was much more than the interest income no interest income can be excluded from the profits on which deduction u/s 80IB(5) of the Act ought to be allowed.
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