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2014 (4) TMI 790 - AT - Income TaxDisallowance of Interest u/s. 80IB of the Act – Belated filed Audit Report under Rule 46A - Held that:- The decision in CIT vs. Punjab Financial Corporation [2001 (12) TMI 50 - PUNJAB AND HARYANA High Court] and Zenith Processing Mills vs. CIT [1995 (9) TMI 37 - GUJARAT High Court] followed – the otherwise admissible claim of the assessee cannot be defeated for technical reason - the claim of the assessee had been rejected only on the ground that the audit report was not filed along with return of income - The assessee was not asked by the AO to furnish the audit report during assessment proceedings - The assessee had furnished the audit report u/s 10CCB of the Act as additional evidence under rule 46A of the I.T. Rules and the same was admitted by the CIT (A) and also, accepting the explanation of the assessee regarding its failure to submit it before the AO and the remand report was also called from the AO - The AO had not reported anything adverse against the proof submitted by the assessee – Decided in favour of Assessee. Rejection of claim of interest and rent – Held that:- The decision in Liberty India vs. CIT [2009 (8) TMI 63 - SUPREME COURT ] followed - the claim of the assessee is disallowance relating to interest income, rental income and foreign exchange rate fluctuation being not derived from industrial undertaking of the assessee – Decided against Assessee. Income on account of foreign exchange fluctuation – Held that:- The income on account of foreign exchange fluctuation is also to be treated as taxable business income - the income from foreign exchange may be incidental to the business activity of the assessee but the same cannot be said to be derived from the manufacturing activity of the assessee – Decided against Assessee.
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