TaxTMI 
TaxTMI 
2002 (11) TMI 56
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....under section 80HHC of the Income-tax Act, 1961 (for short "the Act"). The appellant is an individual. He derives income from various sources. He has a proprietary business by name "Vijayalekshmi Cashew Company". For the assessment year 1995-96, the appellant filed a return of income on July 22, 1996. While computing the relief under section 80HHC of the Act the Assessing Officer treated the interest of Rs. 61,50,722 received by the appellant on short-term deposits with the bank as income from "other sources". The Assessing Officer also noted that the appellant has got a cash credit loan account with the bank for availing of loan facilities for purchase of raw cashew nuts and that when the imports are completed, during the lean season the s....
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....ers of credit and for keeping margin money and because of which the deposits are committed deposits?" Senior standing counsel appearing for the respondent submits that these questions are squarely covered by the decisions of this court in Abad Enterprises v. CIT [2002] 253 ITR 319 and in CIT v. Jose Thomas [2002] 253 ITR 553 against the appellant and in favour of the Revenue. Counsel appearing for the appellant submits that the said decisions are distinguishable for the reason that in the present case the appellant had to make the short-term deposits only because of the insistence of the bank for making such deposits as a condition precedent for the opening of the letter of credit and for the grant of other facilities which were not c....
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....ench of this court in Nanji Topanbhai and Co.'s case [2000] 243 ITR 192. It is seen that the appellant had contended before the Division Bench that the fixed deposit receipt had to be retained in the bank in order to offer security for loan transaction which was in connection with its business of export and, therefore, the interest received from the fixed deposit is to be treated as part of business income. This court in that context referred to the appellate order of the Tribunal and observed that, according to the Tribunal, there is no evidence in the from of a letter from the bank manager insisting on fixed deposits for availing of loan and that the Tribunal did not accept the contention of the assessee that the assessee was compelled to....
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....nk for fixed deposits for availing the loan, the position would have been different. From the discussion made hereinabove, we are unable to accept the contention that the production of a letter from the bank manager regarding the insistence of fixed deposits as a condition for opening the letter of credit and for other formalities would have changed the situation and in such a situation the appellant would have been entitled to the relief under section 80HHC of the Act. The decision of the Supreme Court in Karnal Co-operative Sugar Mills Ltd.'s case [2000] 243 ITR 2, it must be noted that the said decision was not rendered in the context of the provisions of section 80HHC of the Act. The Supreme Court observed that the assessee had depos....
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....ing from the sale of old machinery and buildings cannot be regarded as profits and gains derived from the conduct of the business of generation and distribution of electricity. In this connection, it may be pointed out that whenever the Legislature wanted to give a restricted meaning in the manner suggested by the learned Solicitor-General, it has used the expression 'derived from', as, for instance, in section 80J. In our view, since the expression of wider import, namely, 'attributable to', has been used, the Legislature intended to cover receipts from sources other than the actual conduct of the business of generation and distribution of electricity." From the above discussion of the meaning of the word "attributable to" with referenc....