The ITAT allowed the assessee's appeal for statistical purposes...

The ITAT allowed the assessee's appeal for statistical purposes and remitted the issue to the AO for fresh adjudication on the claim for proportionate deduction under s.57 of the Act. The Tribunal held that a deduction for expenses attributable to interest income may be permitted only upon the assessee establishing a direct nexus between the expenditure incurred and the earning of interest from nationalized banks. The Tribunal distinguished an earlier decision relied upon by the assessee on the basis that the income profile there (predominantly rental) differed materially from the present facts. The AO is directed to reconsider the claim in light of the required nexus.

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