Interest income linked to power plant set-up held not to raise any question of law

Interest income earned during the assessment year 2010-11 was treated as inextricably linked to the setting up of the assessee's power plant, because the assessee had advanced funds to contractors to facilitate deployment of debt funds and the issue had already been decided on similar facts in earlier years. On that basis, the Court stated that the revenue's challenge did not raise any question of law and the Tribunal's view was upheld in favour of the assessee.

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Issues: Whether the interest income earned during the assessment year 2010-11 was inextricably linked with the setting up of the assessee's power plant so as to support the Tribunal's view and whether any question of law arose.

Analysis: The revenue's challenge was against the Tribunal's finding that the interest income reported for the relevant assessment year was connected with the object of establishing the power plant. The record showed that the assessee had advanced money to contractors for smooth working out of debt funds, and the same issue had already been decided against the revenue in earlier years by this Court on similar facts.

Conclusion: The answer is in the affirmative in favour of the assessee and against the revenue. No question of law arose.

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