https://www.taxtmi.com/caselaws?id=753963 The ITAT Ahmedabad rejected the assessee's claim for deduction of liquidation expenses under section 57(iii) against interest income from fixed deposits. The tribunal held that interest-bearing loans from the government were specifically granted for liquidation expenses, not for earning interest income, establishing no nexus between the expenditure and interest income. The mere fact that both income and expenses occurred during the liquidation process did not establish the required connection. The tribunal emphasized that only expenses incurred for earning interest income qualify for deduction under section 57(iii). However, the tribunal allowed short-term capital gains on assets held over 36 months to be treated as long-term capital gains, qualifying for concessional tax rates under section 112(1). en-us Wed, 29 May 2024 00:00:00 +0530 Thu, 13 Jun 2024 09:52:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=753963 The ITAT Ahmedabad rejected the assessee's claim for deduction of liquidation expenses under section 57(iii) against interest income from fixed deposits. The tribunal held that interest-bearing loans from the government were specifically granted for liquidation expenses, not for earning interest income, establishing no nexus between the expenditure and interest income. The mere fact that both income and expenses occurred during the liquidation process did not establish the required connection. The tribunal emphasized that only expenses incurred for earning interest income qualify for deduction under section 57(iii). However, the tribunal allowed short-term capital gains on assets held over 36 months to be treated as long-term capital gains, qualifying for concessional tax rates under section 112(1). Case-Laws Income Tax Wed, 29 May 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=753963