9911796707
TMI Blog2024 (11) TMI 1161X X X X Extracts X X X X X X X X Extracts X X X X ..... e against interest was accorded by the Ministry. Assessee had made fixed deposit and earned interest which belonged to Central Government of India and was utilized as capital receipt with the prior approval of the Central Government. So, it is a glaring fact that the Central Government of India had an overriding title over the interest on FDR made from capital. Therefore, the interest earned on FDR was not part of income of the appellant. CIT(A) has relied on interest having been shown by assessee as income from other sources. As per ratio of judgment in Kedarnath Jute Mfg Co. Ltd Vs Commissioner of Income Tax (Central), Calcutta s case [ 1971 (8) TMI 10 - SUPREME COURT] it is well settled that the entries made in books of accounts are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0-11 and 2011-12 the Ministry of Ayush, Government of India, made a Share Capital infusion of Rs. 34.00 crores in the Corporation for Renovation and Modernization of the existing facilities of the Assessee s Manufacturing Unit situated at Village Mohan- Ramnagar-Uttarakhand. During the assessment year, the Appellant- Assessee earned an interest of Rs. 1,29,00,837/- on the said Share Capital- as the expansion was done in a phased manner and the Share Capital amount was deposited in the Time Deposits with the bank. Interest earned on Time deposits, was to be utilized for the purpose for which it was sanctioned, and to be treated as the Central Government Share Capital contribution. That for the instant year the Assessee filed its return of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in confirming addition of Rs. 1,29,00,837/- on account of interest earned on Fixed deposit held by the corporation- as custodian, on account of Grant-in-Aid sanctioned for Capital expenses. Learned CIT(A) erred in relying upon entries in the books of accounts maintained by assessee. It is well settled proposition of law that the entries made in the books of account are not relevant for computing total income. Reference to judgment of Hon ble Supreme Court in Kedarnath Jute Mfg Co. Ltd Vs Commissioner of Income Tax (Central), Calcutta reported in 1971 82 ITR 363(supra) was made. Learned CIT(A) wrongly relied upon the judgment of the Hon ble High Court of Madras in Commissioner of Income Tax vs Pandian Chemicals Limited 233 ITR 497; regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenses- as mandated by the Ministry of Ayush, New Delhi and whole of the interest earned was later on converted as Share Capital Contribution of the Central Government as per letter dated 18.01.2016 issued by the Ministry of Ayush, Government of India, New Delhi. The interest on time deposits was treated as share capital infusion and that permission to issue share against interest of Rs. 5.20 crores was accorded by the Ministry. The assessee had made fixed deposit and earned interest which belonged to Central Government of India and was utilized as capital receipt with the prior approval of the Central Government. So, it is a glaring fact that the Central Government of India had an overriding title over the interest on FDR made from capita ..... X X X X Extracts X X X X X X X X Extracts X X X X
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