KARNATAKA MUNICIPAL DATA SOCIETY Vs. INCOME

JUDGEMENT

(1.) As common questions are to be considered, they are considered simultaneously.

(2.) The assessee has preferred all appeals by raising the following questions of law :

(3.) The short facts of the case appears to be that as per the assessee, grant is being released by the Government for its various schemes to the appellant - assessee and such amount of grant is to be utilised for the purposes specified by the Government. Until the amount of grant is utilised, money is to remain in the respective bank account of the assessee-society and interest may accrue thereon. In the assessment proceedings, the Assessing Officer found that interest earned on the aforesaid deposits lying in the bank account can be termed as "income" of the assessee and therefore, exemption from income was unavailable. Matters were carried in the appeal before the Commissioner of Income-tax (Appeals) and the Commissioner of Income-tax (Appeals) dismissed the appeal. The matter was further carried in appeals before the Tribunal and the Tribunal observed thus :