TaxTMI 
TaxTMI 
2010 (1) TMI 965
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.... issue raised by the assessee is regarding deduction under section 80HHC of the Income-tax Act, 1961 (in short, "the Act" ) and treatment of DEPB credits for that purpose. Taking up the first issue, the assessee had during the relevant previous year received interest on Rs. 66,62,198 from its fixed deposits in bank, on which also deduction under section 80HHC of the Act was claimed by it. The assessee is engaged in the business of manufacture/purchase of garments and export thereof. The required the assessee to explain as to why interest income from bank deposits ought not to be treated as income from other sources. Despite the assessee' s explanation that such deposits were kept as per the terms of the bank for sanctioning facilities wh....
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....arned authorised representative submitted that in view of the order of this Tribunal in the following cases, even if interest income was treated under the head " Income from other sources" , expenditure on interest for funds borrowed and utilised for such deposits had to be allowed : S. No. Name ITA No. Assessment year Page No. 1. Majestic Exports v. ACIT Current Trends v. ACIT Fashion Knits v. ACIT 948/Mds/2007 949/Mds/2007 1106/Mds/2007 2002-03 2003-04 2003-04 1-6 2. C. Vasantha v. ACIT Sky International v. ACIT 2019/Mds/2007 2020/Mds/2007 2004-05 2004-05 7-10 3. Majestic Exports v. ACIT 2021/Mds/2007 2004-05 11-1....
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....pra), Current Trends (supra) and Fashion Knits (supra), the co-ordinate bench of this Tribunal, after considering the decision of the hon'ble jurisdictional High Court in the case of Dollar Apparels v. ITO [2007] 294 ITR 484 (Mad) held at paragraphs 8 and 9 as under : "8. We have considered the rival submissions carefully and find force in the arguments of the learned authorised representative. In Dollar Apparels v. ITO [2007] 294 ITR 484 the Madras High Court was concerned with whether the gross interest or the net interest should be excluded under clause (baa) of section 80HHC when such interest income is assessed under the head "Profits and gains of business". In the facts of the present case, the decision of the Madras High Court in ....
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....her sources. In accordance with the decision of the Madras High Court in Procon Systems P. Ltd. v. ITO [2008] 296 ITR 636 where the Madras High Court held that what was already claimed as business expenditure cannot be allowed as deduction once again under the head 'Other sources', we direct the Assessing Officer to withdraw the allowance made in respect of such expenditure which is found allowable as a deduction in computing the income from other sources and as a deduction against the interest income not assessed as other sources so that no such double deduction is claimed. Needless to mention that the Assessing Officer will rework the deduction available to the assessee under section 80HHC on the basis of the revised profits of the busine....