2003 (3) TMI 658

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.... 1. This is an appeal by department against the order of CIT (Appeals), who directed the Assessing Officer to allow the interest received on FDR to be adjusted against interest paid on loans and thereafter recompute the deduction under section 80HHC, relating to assessment year 1995-96. 2. The Assessing Officer reduced under section 80HHC by excluding the interests earned of Rs. 1,48,393 while ....

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....ons reported in Honda Siel Power Products Ltd. v. Dy. CIT [2001] 77 ITD 123 (Delhi)/ 76 ITD 15 (sic); Asstt. CIT v. Sharda Gums & Chemicals Industrial Area [2001] 76 ITD 282 (Jodh.), B.H.P. Engineers Ltd. v. Dy. CIT [1998] 61 TTJ (Delhi) 503 and Asstt. CIT v. Gallium Equipment (P.) Ltd. [2002] 254 ITR 1 (AT). It was further stated that though decisions are also in favour of department, but where t....

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....ided the issue in favour of assessee. In that case also the interest earned on FDR was reduced while computing the deduction. The CIT (Appeals) allowed the appeal of the assessee. Matter travelled up to the stage of Tribunal and finally the Tribunal held that the interest on FDR have a direct nexus with interest paid to bank as the loan facility was obtained from the bank subject to purchasing the....