Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2017 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (5) TMI 1763 - AT - Income TaxAllowability of deduction u/s 10A in respect of the interest income on fixed deposit - AO has disallowed the claim by holding that the interest income has no nexus with the business activity of the assessee and therefore the same cannot be treated as business income of the undertaking - HELD THAT:- In case if the interest income is earned from the deposits made in connection with the business activity of the undertaking then the same is eligible for deduction under Section 10A/10B - In the case of the assessee neither the AO nor the CIT (Appeals) has verified this fact though the assessee in its reply before the Assessing Officer has mentioned that the interest income is earned on the deposits made for securing the Bank Guarantee. Accordingly AO is directed to verify the fact that the interest income in question has been earned from the deposits made for securing the Bank Guarantee and then decide the issue in the light of the decision of Hon'ble jurisdictional High Court in the case of CIT Vs. Motorola India Electronics Pvt. Ltd[2014 (1) TMI 1235 - KARNATAKA HIGH COURT] - Appeal of revenue is allowed for statistical purpose.
|