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2020 (1) TMI 133 - HC - Income TaxInterest income received by the assessee on the delayed payments from customers and suppliers - 'Business Income' OR 'Income from Other Sources' - HELD THAT:- Assessee has referred to the judgments of this Court in case titled as Phatela Cotgin Industries Pvt. Ltd. vs. Commissioner of Income Tax [2007 (5) TMI 226 - PUNJAB AND HARYANA HIGH COURT] wherein it was held that in such a case where there is provision in the contract for interest on the delayed payment of outstanding balance, any delayed payment and interest thereon would be constituted as income from business and not income from other sources. Revenue has argued that actually in that case, an appeal could not be carried to the Supreme Court because of lower tax effect. However, he has not been able to cite any judgment to show or give any reason why the proposition laid down by the Bench in that case could not be followed. In the circumstances, we hold question No.1 against the Revenue and in favour of the Assessee. Deduction u/s 80IC - whether process undertaken by the assessee is a manufacturing activity? - metamorphosis of yarn into thread is manufacturing OR process - HELD THAT:- It is not disputed that the yarn which has been used by the Assessee cannot be utilized, for instance for threading purpose. Resultantly, it falls within the definition of manufacturing. Question No.2 is answered against the Revenue and in favour of the Assessee.
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