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2012 (7) TMI 38 - ITAT MUMBAITreatment of interest income – business income or income from other sources - deduction u/s 80IB of the Act – Held that:- FDRs were made out of borrowed funds, there is a direct nexus between the borrowings and the interest generation. This being so and keeping in view the provisions of section 57(iii) of the Act which provides that in computing the income under the head income from other sources any other expenditure (not being in the nature of capital expenditure) laid out or expended wholly and exclusively for the purpose of making or earning such income, we are of the view that the assessee is entitled to the deduction of interest paid on borrowed funds – Assessee partly allowed Addition made by the AO u/s 145A of the Act - AO observed that as per the provisions of section l45A, all the taxes and duties paid are to be included for the purpose of valuation u/s 145A – Held that:- Assessee is following consistent method of accounting and there is no change in accounting system followed by the assessee in the year under consideration - CIT(A) was fully justified in deleting the addition made by the AO u/s 145A of the Act – In favor of assessee
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