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December 2014

Deduction u/s. 80HHA/80-IA – A. Y. 1991-92: Interest earned on fixed deposits placed out of business compulsion is “derived” from the undertaking – Interest is eligible for deduction:

By K. B. Bhujle Advocate
Reading Time 1 mins
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Empire Pumps Pvt. Ltd. vs. ACIT (Guj); ITA No. 187 of 2003 dated 14-10-2014:

The assessee, eligible for section 80HHA/80-IA, was compelled to park a part of its funds in fixed deposits under the insistence of the financial institutions. The interest income has to be treated as business income and cannot be termed as income from other sources. Interest income is the income derived from the undertaking and is eligible for deduction u/s. 80HHA/80-IA.

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