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TMI Blog2022 (4) TMI 1233X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 82.37 crores for the purpose of acquisition of a capital asset i.e. renovation and refurbishment of hotel acquired by the assessee under SARFEASI Act. The entire ECB loan was disbursed in a single trench in the year under consideration and during this year, the assessee could utilise only ₹ 33.70 crores. Therefore, the assessee had temporarily parked the ECB loan in FDRs till uti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... machinery, such receipts will go to reduce the cost of its assets. These are receipts of a capital nature and cannot be taxed as income. The aforesaid principle has also been reiterated by this Court in Principal Commissioner of Income Tax vs. Facor Power Ltd [ 2016 (1) TMI 461 - DELHI HIGH COURT] Keeping in view the aforesaid, this Court is of the opinion that no substantial question of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ./2016 for the Assessment Year 2012-13. 2. Learned counsel for the Appellant submits that the ITAT has erred in allowing the capitalisation of interest on FDRs earned during the period of construction without appreciating the fact that while utilizing the ECB funds the assessee did not follow RBI guidelines. She also submits that the ITAT has failed to consider the various decisions of the Apex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The net amount of interest of ₹ 9.35 crores has been added to the preoperative expenditure pending capitalization. 4. The judgment passed in Tuticorin Alkali Chemicals (supra) referred to and relied upon by learned standing counsel for the Appellant has been considered and explained subsequently by the Apex Court in Commissioner of Income Tax, Bihar II, Patna vs. Bokaro Steel Ltd., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see by the joint venture partner were inextricably linked with the setting up of the plant, the interest earned by the assessee could not be treated as income from other sources. In the result we answer the question as framed in favour of the assessee and against the Revenue....... 6. The aforesaid principle has also been reiterated by this Court in Principal Commissioner of Income Tax vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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