2010 (4) TMI 49

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..... equently, funds were made available to the Government of India and the same were canalised through the assessee [HUDCO]. The assessee, in turn, gave loans to suitable agencies, such as NGOs, which were to be selected by the assessee on the criteria prescribed by KFW Germany, the interest thereon would be taxable in the hands of the assessee. – held that – The assessee never became the owner of the .....

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..... . ITA 430/2010 1. The present appeal, filed by the revenue, is directed against the order dated 30.04.2008 passed by the Income-tax Appellate Tribunal in ITA No.2040/Del/2002, relating to the assessment year 1997-98. KFW Germany had entered into an agreement with the Government of India for financing housing schemes for economically weaker sections. Consequently, funds were made available to th .....

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..... ween KFW Germany and the assessee [HUDCO], it was clear that the funds were received by the Government of India and the assessee merely acted as a canalising agency. The assessee never became the owner of the funds given to it under the project agreement. Nor could the assessee use the funds for anything other than the specified purposes and in the specified manner. Even the interest earned on the .....

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