1991 (1) TMI 34

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.... Income-tax Act, 1961, for the assessment year 1976-77, the following question of law has been referred to this court : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in treating income from interest on fixed and other deposits as income from 'Business' and not as income from 'Other sources' and, in that view, was correct in directing that the revenue ex....

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....m other sources. The appellant company, therefore, was entitled only to such expenditure which was incurred in connection with earning of income from other sources. On the facts of the case, it cannot be said that the disallowance made by the Income-tax Officer was unjustified particularly keeping in view the fact that a major portion of the expenditure is on account of interest on loans which hav....

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....nterest. Such earning, according to the Tribunal, arising from utilisation of commercial assets would be business income and it would not be correct to say that the income in question was "income from other sources". The Tribunal, in that view, was of the opinion that the income derived from the utilisation of commercial assets would be income from business. The Tribunal, on the question of busine....

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.... interest income should be assessed under the head "Business". From the narration of facts, it will be evident that the findings of the Tribunal that the assessee in fact was carrying on business has not been challenged by the Revenue. That apart, the fact remains that although the income was earned by way of interest from the fixed deposits, the Income-tax Officer allowed the expenditure incurred....