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2009 (12) TMI 226 - HC - Income TaxBusiness- The assessee was carrying on the business of growing tea leaves by agricultural process in its own tea gardens in the States of Assam and West Bengal as, also, was manufacturing black tea out of the said green tea leaves grown in its tea gardens as well as acquired from other growers and selling the same both in the domestic and in the international markets. The assessee procured loans from banks and other Public Financial Institutions for its tea growing and manufacturing business. Parts of such funds produced by the assessee by way of loan from the sources remained unutilized. The surplus funds were invested in short term deposits. The assessee earned interest from such investments. On the question whether interest constituted business income. Held that- allowing the appeal, that the main activity of the assessee was growing, manufacturing, and selling of tea and not that of earning interest by investing in short term fixed deposits made out of the business funds available with the assessee before they were utilized for actual business and, therefore, it was incidental to the business activity of the assessee and interest on such short term deposit must be treated as business income - Appeals are allowed
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