Itxa/4184/2009 Of The Commissioner Of Income Tax -3 Mumbai v. Floreat Investmdents Ltd

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.4184 OF 2009 The Commissioner of Income Tax-3 ..Appellant. V/s. M/s. Floreat Investments Ltd. ..Respondent. Mr. Vimal Gupta for appellant. Mr. Poras Kaka, senior Advocate with A.K. Jasani for respondent. CORAM : J.P. DEVADHAR AND R.M. SAVANT, JJ. DATED : 30TH NOVEMBER, 2010 P.C. :- 1.Only two questions of law, namely (A) & (D) are pressed by the revenue in this appeal, which read as under:- (A)Whether on the facts and in the circumstances of the case and in law, the Tribunal was right in holding that interest from government securities, bank interest and interest from inter-corporate deposits received by the assessee company amounting to Rs.28,79,611/- was ‘Business Income’ as claimed by the assessee company and not ‘income from other sources’ as held by the Assessing Officer even though such income did not arise from the business activity of the assessee company ?law, the Tribunal was right in holding that interest from government securities, bank interest and interest from inter-corporate deposits received by the assessee company amounting to Rs.28,79,611/- was ‘Business Income’ as claimed by the assessee company and not ‘income from other sources’ as held by the Assessing Officer even though such income did not arise from the business activity of the assessee company ? 2 itxa4184-09 (D)Whether on the facts and in the circumstances of the case and in law, the Tribunal was right in deleting the disallowance made by the Assessing Officer of various establishment expenses like salaries, auditors professional fees, miscellaneous expenses and depreciation on furniture and fixtures even though such expenses were attributed to the property development business of the assessee company and the assessee company follows the project completion method of determining its profits ?law, the Tribunal was right in deleting the disallowance made by the Assessing Officer of various establishment expenses like salaries, auditors professional fees, miscellaneous expenses and depreciation on furniture and fixtures even though such expenses were attributed to the property development business of the assessee company and the assessee company follows the project completion method of determining its profits ? 2.It is not in dispute that the assessee company initially commenced its business as a investment company and the interest income earned from the investments made by the assessee for all the earlier years has been assessed as business income and there is nothing on record to suggest that the revenue has challenged the said assessments. In the absence of any material to the contrary, the decision of the Tribunal in allowing the claim of the assessee cannot be faulted. Accordingly, the appeal is dismissed with no order as to costs. (R.M. SAVANT, J.) (J.P. DEVADHAR, J.)