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2016 (1) TMI 227 - HC - Income TaxInterest on FDRs - Whether Tribunal has failed to adjudicate the issue in treating the interest on FDRs income under the head income from other sources and allowed the corresponding deduction of interest expenses under section 36(1)(iii) instead under section 57(iii) - Held that:- The FDRs were kept in the bank as margin money of obtaining loans. In support of the connection of the interest paid on loan with the FDRs in question, the assessee has enclosed the relevant account statements, details of interest paid etc. before the Assessing Officer and the Assessing Officer has not negated the connection between the interest paid on loan and FDRs. The only difficulty made out by the Assessing Officer to deny deduction claimed under section 57(iii) was that in view of the voluminous details, interest paid to ICICI and IDBI for the funds utilized for the FDRs, cannot be exactly determined. Therefore, considered in this light and especially in view of the fact situation, that there was no material has been referred to by the CIT(Appeals) to hold that the interest expenditure has not been expended for the impugned FDR, we do not find any weight in the aforesaid conclusion by the CIT(Appeals). As a consequence, it has to be held that the interest paid to ICICI and IDBI band on funds utilized to make the impugned FDRs is an allowable deduction under section 57(iii) against the interest income on such FDRs. Thus, the claim of the assessee under section 57(iii) of the Act on account of interest expenditure amounting to ₹ 11,56, 764/- being more than the amount of interest assessable under the had 'income from other sources', there remains a loss of ₹ 1,44,240/- assessable under the head 'income from other sources'. - Decided against revenue
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