2022 (2) TMI 184

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....m engaged in the business of manufacture and exporter of hosiery garments. For the assessment year 2003-04, the appellant had filed a return of income on 12.02.2004 admitting a total income of Rs. 1,25,02,827/-, which was processed under Section 143(1) of the Income Tax Act, 1961 (in short 'the Act'). The assessee had admitted a sum of Rs. 93,82,884/- being the gross interest received from the fixed deposits as income from business, on the premise that the interest income on fixed deposits is closely linked with the business of the assessee; and there was interest payment also to the Bank on borrowed capital and the interest received though not considered, subsequently as profits derived from exports, but netted against the interest....

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....ned out of deposits made from the business funds including borrowed funds in the course of running the business of the appellant is to be assessed as income from other sources and not income from business ? 2. Whether on the facts and circumstances of the case, the Appellate Tribunal is right in holding that the interest income be assessed under the head 'Income from other sources' when in fact per se, it has a direct nexus to the business of the appellant ? 3. Whether on the facts and circumstances of the case, the Appellate Tribunal is right in law in holding that interest on borrowed capital cannot be set off against the interest earned on Fixed deposits ? 4. Whether on the facts and circumstances of the case, the Appellate....