TMI Blog2021 (9) TMI 290X X X X Extracts X X X X X X X X Extracts X X X X ..... l of assessee is allowed for statistical purposes. - I.T.A. No. 1883/Kol/2019 - - - Dated:- 3-9-2021 - Shri P. M. Jagtap, Vice President (KZ) And Shri A. T. Varkey, Judicial Member For the Appellant : Shri S. Jhajharia, FCA For the Respondent : Shri Supriyo Pal, Addl. CIT ORDER PER SHRI A. T. VARKEY, JM: This is an appeal preferred by the assessee against the order of the Ld. CIT(A)-16, Kolkata dated 25.04.2019 for AY 2013-14. 2. At the outset, the Ld. AR of the assessee Shri S. Jhajharia drew our attention to the fact that the assessee had preferred additional ground of appeal wherein the assessee has raised without prejudice to the grounds of appeal preferred before this Tribunal that since the assessee co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m perusal of Note No. 18 of the Balance Sheet found that the assessee had other income of ₹ 28,07,860/-. On being confronted, the assessee submitted that this other income is the interest from fixed deposit with the bank. According to the assessee, the fixed deposit are kept with the bank for margin money and it is an integral part of the business requirement and hence, eligible for deduction u/s. 80IC of the Act. However, the AO did not accept the submission of the assessee and had disallowed ₹ 28,07,860/- and added the same as income of the assessee. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A) who has confirmed the same. 4. At the outset, the Ld. AR drew our attention to the Tribunal s order on the ver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls that the FD with the bank is for issue of bank guarantee for procurement of raw material from M/s SAIL and hence such interest income is for the purpose of business of the assessee. So, according to him, the nature of interest income being business and even if the aforesaid receipt [interest from FD] is not eligible for deduction u/s 80IC in view of the judgment of the Hon ble Calcutta High Court in the case of Reckitt Benckiser India (P) Ltd. vs. ACIT, Kolkata (2015) 56 taxmann.com 415 (Cal) and also the judgment of Hon ble Supreme Court in the case of Liberty India Ltd. vs. CIT (2009) 183 Taxman 349 (SC) because, it does not have first degree nexus with the profits earned from the eligible unit, still such interest should be allowed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. Accordingly, this ground is partly allowed. 4. Aggrieved the Revenue is before us assailing the aforesaid action of Ld. CIT(A). However, we note that the Ld. CIT(A) at page 15 of the impugned order has confirmed the action of the AO in respect of disallowance of interest income from fixed deposit. However, has mistakenly typed the figure as ₹ 5,52,844/- in place of ₹ 20,37,345/-. Since, the interest income from fixed deposit cannot be having first degree nexus with the profit and gain derived from the undertaking which is eligible for deduction u/s 80IC of the Act, we confirm the order of the Ld. CIT(A) and correct the mistake of the figures shown as ₹ 20,37,345/- in place of ₹ 5,52,844/-. And so the Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X
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