The Tax Publishers2020 TaxPub(DT) 1479 (Bang-Trib)

INCOME TAX ACT, 1961

Section 10A

There was a direct nexus between interest earned on FDs and income of business of section 10A undertaking. Though it did not partake character of a profit and gains from sale of an article, it was the income which was derived from consideration realised by export of articles and, therefore, having regard to the definition of income from profit and gain as envisaged in sub-section (4) of section 10B/10A, benefit of exemption was available to the interest income.

Deduction under section 10A - Allowability - Interest earned on fixed deposits -

Assessee claimed deduction under section 10A in respect of interest earned on Fixed Deposits. AO denied this. Held:There was a direct nexus between interest earned on FDs and income of the business of section 10A undertaking. Though it did not partake the character of a profit and gains from sale of an article, it was the income which was derived from consideration realised by export of articles and, therefore, having regard to the definition of income from profit and gain as envisaged in sub-section (4) of section 10B/10A, benefit of exemption was available to the interest income.

Relied: CIT v. Motorola India Electronics (P.) Ltd. (2014) 46 taxmann.com 167 (Kar.) : 2014 TaxPub(DT) 0705 (Karn-HC)

REFERRED :

FAVOUR : in assessee's favour

A.Y. : 2010-11

INCOME TAX ACT, 1961

Section 10A

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