TMI Blog2010 (9) TMI 1180X X X X Extracts X X X X X X X X Extracts X X X X ..... sing out of the order of Commissioner of Income-tax (Appeals)-I, Surat in appeal No. CAS-I/32/07-08 dated 01-10- 2007. The assessment was framed by DCIT, Circle-1, Surat u/s143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) vide his order dated 29-03-2007 for assessment year 2005-06. 2. The only issue in this appeal of Revenue is against the order of CIT(A) deleting disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12-2005 showing total income at Rs. Nil. and claimed deduction u/s.80IB of the Act amounting to ₹ 29,37,042/-. On perusal of the audit report, profit and loss account the Assessing Officer noticed that the assessee declared other income as late payment charges at ₹ 20,09,915/-, wastage/scrap sales at ₹ 4,64,139/- and interest on FDR at ₹ 42,289/-. On scrutiny u/s.143(3) on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decided in that year the late payment charges of ₹ 20,09,915/- have to be considered as business income in view of the decision of Jurisdictional Gujarat High Court in the case of Nirma Industries (supra). The scrap sales of ₹ 4,64,139/- has to be considered as business income in view of the decision of Hon ble High Court in the case of Harjivandas Jhuthabhai (supra). The interest inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dertaking. We find that the Hon ble High Court has allowed deduction under Section 80I on delayed payment of interest received from trade debtors, the assessee is entitled for deduction under Section 80IA of the Act also. Accordingly, the interest on delayed payment is eligible for deduction u/s.80IB of the Act. As regard to scrap sale, the same has direct nexus with the manufacturing activity and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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