TaxTMI 
TaxTMI 
2026 (6) TMI 89
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....is factually incorrect, as the assessee had duly furnished substantive evidence including the subsidy sanction letter, ledger accounts, bank statements reflecting receipt and utilization of subsidy, and supporting statutory records. However, respective authorities failed to consider and appreciate the evidence placed on record, and the confirming the said finding without proper examination of the material available on record. 2. On the facts and circumstances of the case, the Learned Assessing Officer has erred in law and on fact in making an addition, which disallowed the claim u/s 80-IB of Rs. 3,790/- on account of savings account interest, which is a mechanical error, as the appellant being a company cannot maintain a savings bank account, and the said amount is already reflected in Form 26AS. The Ld. AO has further erred in disallowing income from interest on income tax refund amounting to Rs. 2,295/- without proper justification, whereas assessee has already disclosed in the return of Income. 3. On the basis of the facts and circumstances of the case, the Learned Commissioner of Income Tax (Appeals) and the Learned Assessing Officer have erred in law and on f....
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....ing a cold storage plant of 5002 MT capacity. As per Form 10CCB filed, the date of commencement of operation has been shown, as 01.05.2017 and 2018-19, as the initial assessment year from when deduction u/s 80IB(11) is being claimed. During the year under consideration, the assessee has shown gross revenue from sale of services at Rs. 1,42,71,233/- and interest income at Rs 22,85,832/-. On perusal of the Profit & Loss account, it was observed that the assessee has received the following "Other Income" during the year: i. Interest on Fixed deposit 22,36,757/- ii. Interest on saving bank 3,790/- iii. Interest on PGVCL deposit 42,990/- iv. Subsidy from PGVCL 3,00,000/- v. Interest on IT refund 2,295/- vi. Kasar 311/- Total 25,86,143/- 4. In response, to the notice of the assessing officer, the assessee submitted its reply before assessing officer, which is reproduced below: "1. Interest on Fixed Deposit of Rs. 22,36,757/- With regards above we would like to clarify that the fixed deposit was not done as part of investment or savings, but it was mandatory in relation to the government, bank, and ....
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....ease find attached following 1. Copy of judgement of Bombay High court in the case of TEMA Exchangers Manufactures (P) Ltd - Annexure - A 2. Copy of judgement of Delhi High court in the case of Eltek SGS (P) Ltd. - Annexure - B 3. Copy of judgement of Gujarat High court in the case of Empire Pumps (P) Ltd - Annexure - C 4. Copy of Ledger of F.D. interest income - Annexure - D 5. Copy of Ledger of Loan Interest - Annexure - E 6. Copy of statement of loan account of state bank of India. - Annexure -F 5. However, the assessing officer, rejected the contention of the assessee and noted that as per the provisions of section 80IB(11) of the Act, the income derived from the business of setting up and operating a cold chain facility is eligible for deduction and as held in the various judicial pronouncements, the expression "derived from" in section 801B(11) envisages a direct or first degree connection of the income eligible for deduction with the corresponding business of the assessee of setting up and operating a cold chain facility. This well settled test is applicable in the present case and the interest of Rs. 22,42,842/- earne....
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.... from other sources, which reads as under: "56(2)(id) income by way of interest on securities, if the income is not chargeable to income tax under head "profits and gains of business or profession". Therefore, I note that the said fixed deposit relates to subsidy and thus interest on it shall be considered as income chargeable under the head "profits and gains of business or profession" and not under the head "income from other sources". If the subsidy was directly credited to loan account it would have reduced the burden of interest on the assessee- company, which not being the case the company earned interest which was shown as income and as expense the whole loan interest was debited to profit and loss account. Therefore, it is income chargeable under the head income from profits and gains of business or profession. Section 80-IB of the income tax Act reads as where the gross total income of an assessee includes any profits and gains derived from any business referred to in subsection (3) to (11), (11A) & (11B) of the Act. The Bombay high court in the case of TEMA Exchangers Manufactures (P) Ltd has rightly drawn the difference between the section 80-IA and 80HH stat....
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.... No. HRT-9/Tech/CSU/PO/JMN/455-460/18 AB Date :- 09/03/2018 To, Branch Manager, State Bank of India, Digvijay Plot Branch (60087), Jamnagar-361004 Gujarat State Subject: Release of credit linked back ended subsidy for cold storage project under NHM during the Year 2017-18 as 1st and final installment in the favour of M/s. Shreenath Spediators Pvt. Ltd. cold storage, survey no. 400 P1, plot no. 1, 2, 3 & 4P, opp. Mangalya Party Plot, Nr. Jamnagar-Rajkot over bridge, At. Hapaa, Ta. & Dist. Jamnagar-361120. Ret: 1. GOG Letter No. HRT/1016/245/K.8, Sachivalaya, Gandhinagar. Dt .: 06.04.2017 2. SEO-JDH, (NHM), Gandhinagar Letter No. HRT/8-9/12-17/5993-6030/17. Dt .: 29.04.2017 3. Minutes of the 49" committee meeting of the state Level Executive Committee Meeting held on Dated: 21.09.2017 4. Technical & Physical scrutiny report from WAPCOS Ltd. Gandhinagar Letter on Date: . 03.2018 5. Letter from Branch Manager, State Bank of India, Digvijay Plot Branch (60087), Jamnagar-361004 Gujarat, Date: 27 10.2017 6. Joint Inspection Team Visit Report, Dated: 07.03.2018 Respected Sir, In continuation with the above cited subject and references, it is to state that State H....
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....e adjustment of the released Rs. 143.50/- Lakh (Rupees One Hundred Fourty Three Lakh Fifty Thousand Only) will be on the pattern of back ended subsidy. Accordingly, the full project cost including the subsidy amount but excluding the margin money contribution from the beneficiary would be disbursed as loan by the bank. The payment scheduled will be drawn on the loan amount in such a way that the subsidy amount is adjusted after the bank loan portion (excluding subsidy) is liquidated. 6 The subsidy admissable to the borrower and released under the scheme will be kept in the Subsidy Reserve Fund A/c No. 33028827264, IFSC: SBIN0060087, MICR: 361002007, SWIFT: SBININBB623 in the State Bank of India, Digvijay Plot Branch (60087), Jamnagar-361004. No Interest would be applied or this by bank in view of this, for the purpose of charging of interest on the loan, the subsidy amount would be excluded. 7 The amount of subsidy for Cold Storage Project, subsidy Rs. 143.50/- Lakh (Rupees One Hundred Fourty Three Lakh Fifty Thousand Only) shall be drawn from the Gujarat Horticulture Mission A/c No. 098511000312, Dena bank, Gandhinagar, which will be remitted by RTGS in favour of State Bank ....