2005 (9) TMI 47

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....f that have given rise to the aforesaid substantial question of law may be noticed first. Respondent No. 1 (for short, "the assessee"), is a company engaged in the business of manufacturing of industrial jewels. For the assessment year 1990-91, the assessee filed its return and disclosed an income of Rs. 24,53,870 after claiming deduction under sections 80HH and 80-I of the Income-tax Act. The return filed by the assessee was processed and selected for scrutiny. It was found in the scrutiny that the assessee had earned interest income of Rs. 7,07,711 during the relevant year. The explanation submitted by the assessee that short-term deposits were made in order to utilise funds being beneficial to the company was not accepted by the Asses....

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....------------------------------------------ Vr. ref.            Particulars               Amount and date                                        Rs.  --------------------------------------------------------- (1)                     (2)              &nb....

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....p; Square B650/17.10.89    Interest on deposit with     10,410                  Photofantacy B983/10.1.90     C.B. Development             46,250                  Corporation-interest                  on deposit B999/16.1.90     Neem Timber-interest         46,260            &n....

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....nbsp;   Real Estate J49/31.3.90      Interest on deposit with                  M/s. Electrosales Poona        66,840                                               ----------                          Total       &nbsp....