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2018 (7) TMI 1904 - HC - Income TaxInterest on sum of OFCD deposited in bank - capitalization of interest earned - Whether interest earned is not inextricably linked to setting up of plant and machinery? - Appellant had issued Optional Fully Convertible Debentures (OFCD) and amounts were deposited in Bank and earned interest thereon - Whether assessee deposited money in the bank itself is not sufficient to show that the deposit was made with a view to carrying out the business in the sense of earning profit by investment? - HELD THAT:- In the present facts, both the CIT (A) and the Tribunal have rendered a finding of fact that the interest earned is not inextricably linked to setting up of plant and machinery on the part of the Appellant-Assessee. It also records a finding that money by OFCD was not received for setting up of plant. Therefore, cannot be capitalised. We find that on the facts as found by the Authorities, the decision of the Apex Court in Bokaro Steels Ltd. [1998 (12) TMI 4 - SUPREME COURT] and Karnal Cooperative Sugar Mills Ltd. . [1999 (4) TMI 7 - SUPREME COURT] has been correctly applied. No substantial question of law Whether Tribunal is right in not adjudicating the alternate argument taken before it that the interest on Fixed Deposit kept in lien favoring trustees of debenture holders is not the income of the assessee but that of the beneficiary debenture holders? - HELD THAT:- As this question was not urged before the Tribunal, no occasion to entertain the same arises in view of the decision of this Court in CIT v. Tata Chemicals [2002 (4) TMI 42 - BOMBAY HIGH COURT].
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