New User   Login      
Tax Management India .com TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (4) TMI 829 - KARNATAKA HIGH COURT

2015 (4) TMI 829 - KARNATAKA HIGH COURT - TMI - Disallowance to deduct the cost and expenditure incurred in earning income under the head "income from other sources" - Held that:- Interest income earned by the appellant falls within the category of "other income" what falls for reconsideration is to answer the question as to whether the Tribunal was right in law in holding that the income by way of interest was chargeable to tax under Section 56 of the Income Tax Act without allowing deductions .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e or the proportionate expenditure incurred by the appellant requires deduction. It is logical that when the Revenue is permitted to assess and recover taxes from assessee under Section 56 by treating the income earned by interest as income from "other sources", the appellant shall be entitled for proportionate expenditure cost incurred in mobilizing the deposit placed in the Bank/s. What can be taxed is only the net income which the appellant earns after deducting cost and expenditure incurred .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d deduction thereof under Section 57(3) of the Act and to pass orders in accordance with law. - ITA No. 1568/2005, ITA Nos. 1569, 1570, 1571, 1572,1573,1574 & 1575 of 2005 - Dated:- 25-3-2015 - B. S. Patil And P. S. Dinesh Kumar,JJ. For the Appellant : Sri A Shankar, Sri M Lava & Sri S S Hegde, Advs. For the Respondent Rep by: Sri Y V Raviraj, Adv. JUDGMENT Appellant in all these appeals are challenging order in ITA Nos.1460 to 1467/Bang/2003 dated 09.11.2004 for the assessment years 1991-92 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ct' for short) was issued by the respondent. Appellant raised an objection that Notice under Section 148 could not have been issued as prior consent of the Additional Commissioner was necessary. The appellant requested the respondent to accept the original returns and also filed one more return as a technical compliance and furnished the information called for. On completion of assessments, order dated 20.01.2003 came to be issued. However, pursuant to certain directions issued by the Additi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

seeking deduction under Section 80P(2)(a)(i) was upheld. However, objections raised by the appellant with regard to validity of notice under Section 148 of the Act in the matter of sanction was rejected by the Commissioner. 3. Revenue being aggrieved by order of the Commissioner of Income Tax (Appeals) allowing the claim of the appellant under Section 80P(2)(a)(i), preferred appeals before the Income Tax Appellate Tribunal. Appellant also filed cross-objections with regard to dismissal of its ap .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t and Sri.Y.V.Raviraj, learned counsel for the Revenue. 6. Learned counsel for the appellant submits that the very issue with regard to the benefit of deduction of interest came up for consideration before the Hon'ble Supreme Court in Civil Appeal Nos.1622/2010 to 1629/2010 filed by the Appellant and by order dated 08.02.2010 the said appeals have been disposed off by recording a finding as follows: "The words "the whole of the amount of profits and gains of business" emphasis .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tment under Section 56 of the Act." 7. Learned counsel for the appellant further submits that the Hon'ble Supreme Court also held that following question advanced by the appellant before the Authorities had remained unanswered and remitted the said question for consideration by this Court. "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the income by way of interest on deposits held with scheduled banks, bonds and other sec .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

at income in respect of which deduction is sought must constitute an operational income and not the other income and further that in the case on hand, the evidence on record indicates that the appellant earns interest on fund which are not required for business purpose and therefore, in the facts and circumstances, the interest income has been held to fall in the category of "other income". 9. Learned counsel for the appellant further submits that the Assessing Officer has erred in com .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

9;ble Supreme Court holding that the appellant earns interest on funds which are not required for business purposes at the given point of time and further that in the facts and circumstances of the case of the appellant such interest income falls in the category of "other income" and has been rightly taxed by the Department under Section 56 of the Income Tax Act, what remains is only to pass a fresh order by the Assessing Authority by giving such permissible deductions under Section 57 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

corded by the Hon'ble Supreme Court that the interest income earned by the appellant falls within the category of "other income" what falls for reconsideration is to answer the question as to whether the Tribunal was right in law in holding that the income by way of interest was chargeable to tax under Section 56 of the Income Tax Act without allowing deductions in respect of proportionate costs incurred as permissible under Section 57. 12. It is no doubt true that the appellant di .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version