TMI Blog2017 (7) TMI 1206X X X X Extracts X X X X X X X X Extracts X X X X ..... project. The said amount cannot be kept for a long time ideally in view of the fact that principal amount which was kept for business purpose has been kept for investment purpose ideally. - Order of ITAT confirmed - Decided against the Revenue. - D.B. IT Appeal No. 144 of 2017 - - - Dated:- 18-7-2017 - Mr. K. S. Jhaveri And Mr. Inderjeet Singh, JJ. For The Appellant : K.D. Mathur and R.B. Mathur For The Respondent : Sanjay Jhanwar JUDGMENT 1. By way of this appeal, the appellant has challenged the judgment and order of the Tribunal whereby the Tribunal has partly allowed the appeal of the assessee and his income which was earned on FDR was taken as a business income. 2. Counsel for the appellant has framed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.Y. 2009-10 dated 11.08.2016 are reproduced as under: 2.18 From the above, it is evident that there are two sets of judgments of Hon ble Supreme Court, proceedings on different lines of reasonings. The Hon ble Delhi High Court in case of Indian Oil Panipat Consortium Ltd. (supra) has considered and interpreted the decisions of Hon ble Supreme Court in case of Tuticorin Alkali Chemicals Fertilizers (supra) as well as Bokaro Steel Ld. (supra). After analyzing both the decisions of Hon ble Supreme court, it held that the test which premeates through the judgment of the Supreme Court in Tuticorin Alkali Chemicals fertilizers Ltd. s case (supra) is that if funds have been borrowed for setting up of a plant and if the funds are sur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hing feature in the instant case that the assessee is not all liberty to use the interest so earned as per its will and discretion unlike the case in Tuticorin Alkali Chemicals Fertilizers (supra) and the interest has to be used solely for the purposes of implementation of the specified projects only. The impugned interest receipt of ₹ 35,39,479/- on such borrowed funds relates to the mega road projects/stretches which were under construction and the completed road projects/stretches upto the date of commencement of commercial operations. Therefore, the interest received prior to commencement of commercial operations of the specified mega road projects will be in the nature of capital receipt and will be required to be set off again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would be no demand of tax. The reply of the assessee has been considered but is not acceptable. The assessee has parked its spare funds in the FDRs in the Banks and the interest there from can not considered as a business receipts. The assessee received interest during preceding years also which shows that the assessee was having spare funds to invest in the FDRs wherefrom it earned interest. Merely commencement of business alone can not change of treatment of income. 5. He further contended that the investment was a surplus amount. 6. In our considered opinion, the amount which was lying with the assessee was required to be invested in a project. The said amount cannot be kept for a long time ideally in view of the fact tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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