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TMI Blog2004 (9) TMI 307X X X X Extracts X X X X X X X X Extracts X X X X ..... ned the expression business of undertaking anywhere in the judgment. The expression used throughout in the judgment is an industrial undertaking . The addition of the term business found in the headnote of the report is, therefore, either a mistake of editing or a mistake of printing. Therefore, as far as the impugned asst. yr. 1997-98 is concerned, the distinction pointed out by the learned chartered accountant very much exists. It is to be seen that provisions of s. 80-IA have been amended subsequently for the purpose of deleting the expression business . This is a point in support of the contention advanced by the learned chartered accountant. The Court has made it very clear that in the case of a 100 per cent exempted unit, its entire i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excluded the above sum of Rs. 32,64,044 from the computation of business profit and brought the same under the head "income from other sources". The result is that the assessee was deprived of the benefit under s. 80-IA to the said extent. The first appeal has been dismissed. Therefore, the second appeal before us. 4. This is the only issue raised in this appeal. The ground raised by the assessee is that the lower authorities have erred in treating the said amount in the nature of bank interest as "income from other sources". It is the contention of the assessee that the interest amount, in fact, formed part of the assessee's business income and it cannot be treated as "income from other sources". 5. Shri S.M. Jain, the learned chartered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that the Hon'ble Supreme Court has held in the case of CIT vs. Govinda Choudhary & Sons (1994) 116 CTR (SC) 61 : (1993) 203 ITR 881 (SC) that an income can be assessed as "income from other sources" only when it does not fall under any other heads of income. It is the case of the chartered accountant that in the present case, the reasons indicate the nexus between the deposits made by the assessee and the business carried on by it and, therefore, the interest arising out of the said deposits cannot be dissociated from the business itself. 7. The learned chartered accountant thereafter relied on the decision of Hon'ble Madras High Court in CIT vs. South India Shipping Corporation Ltd. (1995) 216 ITR 651 (Mad), wherein the Court ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing itself and was not profits or gains derived by the undertaking. The learned Departmental Representative submitted that in ss. 80HH and 80-IA, the profits need be "derived from the industrial undertaking of an assessee" and for the purpose of such, deriving, the income must materially have been generated from the activities carried on by the undertaking itself. The learned Departmental Representative further stated that the Supreme Court in the said case has not only considered the question of "profits and gains derived from an industrial undertaking", but also "profits and gains derived from any business of an industrial undertaking". As the Supreme Court has considered business of undertaking, as such, the distinction sought to be made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exactly a similar case in the context of s. 80HHC in the case of CIT vs. Punit Commercial Ltd. The Court has made therein a distinction between a 100 per cent exempted unit and partially exempted unit. The Court has made it very clear that in the case of a 100 per cent exempted unit, its entire income need to be treated as nothing but its business income. We are of the considered view that the present case is squarely covered by the above decision of the Hon'ble Bombay High Court.
13. Therefore, in the facts and circumstances of the case, we direct the AO to treat the interest on fixed deposits amounting to Rs. 32,64,044 as forming part of assessee's business income.
14. In the result, this appeal is allowed. X X X X Extracts X X X X X X X X Extracts X X X X
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