Itta/3/2013 Of M/S Lanco Kondapalli Power Ltd v. Dy. Commissioner Of Income Tax

IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH ATHYDERABAD THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTAAND THE HON’BLE MS. JUSTICE G. ROHINI I.T.T.A. No.3 of 2013 DATE: 18.06.2013 Between: M/s. Lanco Kondapalli Power Limited,Hyderabad. … Appellant And Deputy Commissioner of Income Tax-I,Circle-16(1), Hyderabad. … Respondent This Court made the following: THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTAANDTHE HON’BLE MS. JUSTICE G. ROHINI I.T.T.A. No.3 of 2013 JUDGMENT:(Per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) This appeal is sought to be admitted on the following suggested substantial question of law. “Whether on the facts and circumstances of the case, theHon’ble Income Tax Appellate Tribunal was right in sustaining theorder of the lower authorities to the effect that the profit ofRs.3,00,09,300/- earned by the Assessee owing to fluctuation ofinterest rates represents income from other sources and not incomefrom business?” We have gone through the impugned order and are of the view that thelearned Tribunal is correct in coming to conclusion that the income out of thesale of the contract through the State Bank of India, Koti, Hyderabad, fixingthe Libor rate is not a business income. The business activity of theassessee is generating power and it is not the business of the appellant tobuy and sell the contract. We, therefore, feel it appropriate to extract the observation of the learned Tribunal, which reads as: “Carrying out of business activity has nothing to do withearning of this income. The claim of the assessee is that when thepayment of interest is also a business expenditure, correspondinglysaving of interest is also a business income. In our opinion, earningfrom business activity is independent from earning from saving onaccount of this kind of hedging.” We accept the finding and logic of the learned Tribunal. Accordingly, the appeal is dismissed. No costs. Date: 18.06.2013 ES ______________ G. ROHINI, J