https://www.taxtmi.com/caselaws?id=12171 Interest earned on deposits of the assessee's own funds with an overseas bank branch was held not to form part of "business profits" for computing deduction under s. 80HHC, as it lacked a direct nexus with export business operations. The HC reasoned that the deposit was made for the assessee's convenience to earn higher interest and was not a mandatory condition for availing credit facilities; the fact that interest paid on borrowings is allowable business expenditure did not convert the deposit interest into business income. Only where a deposit is a pre-condition inextricably linked to carrying on business could such interest be treated as business income. The issue was decided in favour of the Revenue, against the assessee. en-us Tue, 24 Sep 2002 00:00:00 +0530 Thu, 08 Jan 2026 12:53:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=12171 Interest earned on deposits of the assessee's own funds with an overseas bank branch was held not to form part of "business profits" for computing deduction under s. 80HHC, as it lacked a direct nexus with export business operations. The HC reasoned that the deposit was made for the assessee's convenience to earn higher interest and was not a mandatory condition for availing credit facilities; the fact that interest paid on borrowings is allowable business expenditure did not convert the deposit interest into business income. Only where a deposit is a pre-condition inextricably linked to carrying on business could such interest be treated as business income. The issue was decided in favour of the Revenue, against the assessee. Case-Laws Income Tax Tue, 24 Sep 2002 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=12171