TMI Blog2014 (5) TMI 1119X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner and Sri Shambhoo Chopra, Advocate, for respondents. 2. This writ petition under Article 226 has arisen from the order dated 13.10.2011, passed by respondent no. 2, Assistant Commissioner, Income Tax, Agra for the Assessment Year 2009-10 under Section 143 (3) of Income Tax Act, 1961 (hereinafter referred to as Act, 1961 ) and the order dated 4.3.2013 passed by Commissioner of Income Tax-I, Agra, under Section 264 of Act, 1961 dismissing the petition of Assessee against the aforesaid order of Assessing Authority. 3. Petitioner, a registered partnership firm, is engaged in the business of executing civil works contracts in different Departments. For the Assessment year 2009-10, return was filed under Section 139 (1) of Act, 1961 disclosing net taxable income as ₹ 4,99,500/-. Petitioner claimed depreciation of ₹ 25,67,785/- as per the depreciation chart and submitted accounts, i.e. trading, profit and loss accounts, balance sheet, deprecation chart etc. 4. As a condition of receiving contract and for execution thereof, petitioner used to take Fixed Deposit Receipts (hereinafter referred to as F.D.R. ) furnished with the Department as Security and therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (1), be deemed to have been already given full effect to and no further deduction under those sections shall be allowed : Provided that where the assessee is a firm, the salary and interest paid to its partners shall be deducted from the income computed under sub-section (1) subject to the conditions and limits specified in clause (b) of section 40. (3) The written down value of any asset used for the purpose of the business referred to in sub-section (1) shall be deemed to have been calculated as if the assessee had claimed and had been actually allowed the deduction in respect of the depreciation for each of the relevant assessment years. (4) The provisions of sections 44AA and 44AB shall not apply in so far as they relate to the business referred to in sub-section (1) and in computing the monetary limits under those sections, the gross receipts or, as the case may be, the income from the said business shall be excluded. (5) Nothing contained in the foregoing provisions of this section shall apply, where the assessee claims and produces evidence to prove that the profits and gains from the aforesaid business during the previous year relevant to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the case may be, an amount higher than the aforesaid amount as declared by him in his return of income. (3) Any deduction allowable under the provisions of sections 30 to 38 shall, for the purposes of sub-section (1), be deemed to have been already given full effect to and no further deduction under those sections shall be allowed : Provided that where the assessee is a firm, the salary and interest paid to its partners shall be deducted from the income computed under sub-section (1) subject to the conditions and limits specified in clause (b) of section 40. (4) The written down value of any asset used for the purpose of the business referred to in sub-section (1) shall be deemed to have been calculated as if the assessee had claimed and had been actually allowed the deduction in respect of the depreciation for each of the relevant assessment years. (5) The provisions of sections 44AA and 44AB shall not apply in so far as they relate to the business referred to in sub-section (1) and in computing the monetary limits under those sections, the gross receipts or, as the case may be, the income from the said business shall be excluded. (6) Nothing contained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to have been already given full effect to and no further deduction under those sections shall be allowed : Provided that where the assessee is a firm, the salary and interest paid to its partners shall be deducted from the income computed under sub-section (1) subject to the conditions and limits specified in clause (b) of section 40. (3) The written down value of any asset used for the purpose of the business referred to in sub-section (1) shall be deemed to have been calculated as if the assessee had claimed and had been actually allowed the deduction in respect of the depreciation for each of the relevant assessment years. (4) The provisions of sections 44AA and 44AB shall not apply in so far as they relate to the business referred to in sub-section (1) and in computing the monetary limits under those sections, the total turnover or, as the case may be, the income from the said business shall be excluded. (5) Notwithstanding anything contained in the foregoing provisions of this section, an assessee may claim lower profits and gains than the profits and gains specified in sub-section (1), if he keeps and maintains such books of account and other documents a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certain amounts, were invested in fixed deposits, which had accrued interest. The assessee has shown the interest accrued on the fixed deposits as business interest. But the Assessing Officer treated the interest, considering the same as income from other sources and called upon the assessee to show cause, which order has been further confirmed by the Income-tax Appellate Tribunal. This appeal is filed against the concurrent findings of the courts below. 4. Having heard counsel for both sides, we have noticed that the investment of amount in fixed deposits by the assessee was only to secure a bank guarantee to be offered to M/s. KPTCL in order to acquire a contract work. Therefore, it cannot be treated as an income from other sources and interest accrued on such fixed deposits has to be treated as business income only. Our view is also supported by the judgment of the Supreme Court in the case of CIT Vs. Govinda Choudhury and Sons reported in (1993) 203 ITR 881. 5. In the result the appeal is dismissed. The question of law is answered against the Revenue. 9. The above dictum is clearly applicable in the case in hand also. The F.D.R. have not been received by Assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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