https://www.taxtmi.com/caselaws?id=785882 Whether interest earned on surplus government grants invested with a state financial service falls within the exemption under section 10(23C)(iiiab) was decided by applying a purposive construction of "wholly or substantially financed by the Government." The tribunal reasoned that interest on grants that is mandatorily refundable retains the character of government funds and cannot be treated as independent income; reliance on a narrow arithmetic year-wise test and on Visvesvaraya Technological University was rejected. Consequence: the assessee's interest income was held exempt under section 10(23C)(iiiab) for AY 2017-18 and the appeal was allowed. en-us Thu, 29 Jan 2026 00:00:00 +0530 Mon, 02 Feb 2026 08:20:20 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=785882 Whether interest earned on surplus government grants invested with a state financial service falls within the exemption under section 10(23C)(iiiab) was decided by applying a purposive construction of "wholly or substantially financed by the Government." The tribunal reasoned that interest on grants that is mandatorily refundable retains the character of government funds and cannot be treated as independent income; reliance on a narrow arithmetic year-wise test and on Visvesvaraya Technological University was rejected. Consequence: the assessee's interest income was held exempt under section 10(23C)(iiiab) for AY 2017-18 and the appeal was allowed. Case-Laws Income Tax Thu, 29 Jan 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=785882