Itxa/1306/2011 Of Mahendra Brothers v. Dy. Commissioner Of Income Tax 16(3) Mumbai

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1306 OF 2011 M/s. Mahendra Brothers ..Appellant. V/s.Dy. Commissioner of Income Tax 16(3),Mumbai & Another..Respondents. Mr. S. J. Mehta, for the Appellant.Mr. A. R. Malhotra, for the Respondents. P.C:- CORAM: J.P.DEVADHAR & M.S.SANKLECHA,JJ.DATE : 11[th] JANUARY, 2013. Heard. Admit on the following substantial question of law:- “(1)Whether on the facts and circumstances of the case the Tribunal is right in denying netting of the interest received by the Appellant on the fixed deposits placed with the banks as margin money to avail credit facilities against interest paid for the purposes of working out the deduction under sec. 80HHC of the Act.? (2)Whether on the facts and circumstances of the case the Tribunal was right in holding that 90% of the gross interest received on the fixed deposits kept with the bank as margin money should be deducted under Explanation (baa) to Sec. 80HHC of the Act while working out the adjusted profit? (3)Whether on the facts and in the circumstances of the case the Tribunal was right in not allowing the expenses incurred for earing interest on fixed deposits kept with the bank as margin money for availing various facilities.?” 3Advocate for the parties states that first two questions stand covered in favour of the Assessee and against the Revenue by the decision of the Apex Court in the matter of ACG Associated Capsules Pvt. Ltd. v/s. Commissioner of Income-Tax reported in 343 ITR page 89. 4So far Question No.3 is concerned, the Advocate states that in view of the answer to the first two questions, the third question does not arise. Accordingly, Appeal is allowed by answering the first two questions in favour of the Assessee and against the Revenue. 5Appeal is allowed with no order as to costs. (M.S.SANKLECHA,J.) (J.P.DEVADHAR,J.)