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TMI Blog2021 (12) TMI 456X X X X Extracts X X X X X X X X Extracts X X X X ..... ting exclusion of such amount for the purpose of 80P(2)(a)(i) of the Act. Since interest income earned by the assessee was treated to be income from other sources under section 56, then, the assessee can claim deduction u/s 57 of the Act. Therefore, we direct the AO to allow expenditure for earning such interest income. In other words, the ld.AO has to determine the net interest income earned by the assessee after giving set off expenditure, and only thereafter that net income has to be excluded from the admissibility of deduction under section 80P(2) of the Act. Grounds of appeal of the assessee are thus partly allowed for the statistical purpose. - ITA No.1551/Ahd/2019 - - - Dated:- 8-12-2021 - Shri Rajpal Yadav, Vice-President A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to earning of such interest income deserves to be set off against this income, and thereafter net interest income is to be excluded from computation of deduction admissible under section 80P(2). However, the ld.AO did not accept submissions of the assessee. He disallowed the same, however, after giving benefit of section 80P(2)(c) of the Act. On appeal, the ld.CIT(A) has allowed 5% of interest income as expenditure for earning this interest income, and thus gave a relief of ₹ 8,491/- and the balance amount was confirmed. The assessee is aggrieved qua quantification of the relief, hence before the Tribunal. 4. With the assistance of the ld.representatives, we have gone through the record carefully. 5. Before us, the ld.couns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under section 80P(2)(d) because it is not from cooperative society, in view of the above judgment of Hon ble Gujarat High Court. However, we find merit in the contention of the assessee that expenditure should be allowed in respect of interest income earned from the investments. If the component of income does not qualify for grant of deduction under section 80P(2)(a)(i), then such income should be computed on net basis; any expenditure relatable to earning of such income is to be allowed before calculating exclusion of such amount for the purpose of 80P(2)(a)(i) of the Act. Since interest income earned by the assessee was treated to be income from other sources under section 56, then, the assessee can claim deduction under section 57 o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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