1998 (4) TMI 61

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..... nion of this court under section 256(1) of the Income-tax Act 1961 the following question : "Whether, on the facts and in the circumstances of the case, the Tribunal was right in coming to the conclusion that the interest and miscellaneous receipts were not liable to be assessed as income under the Income-tax Act, 1961 ?" The matter pertains to the assessment years 1976-77 and 1977-78. The asses .....

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..... ther income . The Income-tax Officer however allowed deduction of five per cent expenses for the assessment year 1977-78. The Commissioner of Income-tax (Appeals) confirmed the decision of the Income-tax Officer but raised deduction of expenditure to 10 per cent. as against the five per cent. allowed by the Income-tax Officer for the assessment year 1977-78. The Tribunal however held that the rece .....

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..... ey for business purposes but utilises that money to earn interest howsoever temporarily the interest so generated will be his income. Such income can be utilised by the assessee whichever way he likes. He may or may not discharge his liability to pay interest with this income. It was held that merely because such income was utilised to repay the interest on the loan taken by the assessee it did no .....

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