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TMI Blog2016 (8) TMI 113X X X X Extracts X X X X X X X X Extracts X X X X ..... t as well, otherwise, money deposits given for investments, etc., would also qualify as advances and interest thereon would become exigible to the Interesttax Act. Such a situation was never contemplated by the legislature. Hence, inter-corporate deposit is not in the nature of loan or advance within the meaning of section 2(7) and therefore, not chargeable to the interest-tax under section 5 - Decided in favour of the assessee - TAX APPEAL NO. 1215 of 2007 - - - Dated:- 15-7-2016 - MR. KS JHAVERI AND MR. G.R.UDHWANI, JJ. FOR THE APPELLANT : MR NITIN K MEHTA, ADVOCATE FOR THE OPPONENT : MRS SWATI SOPARKAR, ADVOCATE ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. This Tax Appeal u/s.260A of the Income- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have already been decided by this Court in a group of appeals being Tax Appeal No.1214/2007 allied matters decided on 27.06.2016. For ready reference, the said judgment is reproduced hereunder: 1. These Tax Appeals under Section 260A of the Income-tax Act, 1961 are filed against the common order dated 30.11.2005 passed by the Income Tax Appellate Tribunal, Ahmedabad Bench A in ITA Nos.18 to 20/Ahd/2005 and 45 to 47/Ahd/2004 raising the following common substantial questions of law: [A] Whether the Appellate Tribunal is right in law and on facts in holding that the income from interest on inter corporate deposit was not chargeable to tax under the Interest Tax Act? [B] Whether the Appellate Tribunal is right in law and on facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i High Court rendered in the case of Commissioner of Income-tax v. Visisth Chay Vyapar Ltd., [2011] 339 ITR 157 (Delhi) ([2012] 20 taxmann.com 377 (Delhi)] wherein, it has been held that the expression advance occurring in section 2(7) along with the expression loan should take its colour from loan and cannot be given wider interpretation to include deposit as well, otherwise, money deposits given for investments, etc., would also qualify as advances and interest thereon would become exigible to the Interesttax Act. Such a situation was never contemplated by the legislature. Hence, intercorporate deposit is not in the nature of loan or advance within the meaning of section 2(7) and therefore, not chargeable to the interesttax under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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