COMMISSIONER OF INCOME TAX Vs. COSMOS INTERNATIONAL

JUDGEMENT

(1.) 2007 passed by the Income -tax Appellate Tribunal (hereinafter referred to as the 'Tribunal') in ITA No. 3967/Del/2006 pertaining to the asst. yr. 2003 -04.

(2.) THE Revenue is aggrieved by the impugned judgment, insofar as the Tribunal held that interest income on fixed deposits earned by the assessee be treated as 'business income', as against 'income from other sources'. The consequent effect of which would be that the assessee would be required to deduct 90 per cent of such interest from the 'profits of the business' under s. 80HHC of the Act. service report, the respondent has been served. Despite service of notice, the respondent has chosen not to put in an appearance before this Court. This has left us with no alternative but to proceed to decide the present appeal in the absence of the respondent and/or its Authorised Representative.

(3.) The learned counsel for the Revenue, Ms. Prem Lata Bansal has contended before us that the impugned judgment of the Tribunal deserves to be set aside in view of the fact that it is contrary to the judgment of this Court passed in the case of CIT vs. Shri Ram Honda Power Equip. (2007) 207 CTR (Del) 689 : (2007) 289 ITR 475 (Del). We have examined the orders passed by the authorities below and upon perusal of the same, we have come to the conclusion that the submission of the learned counsel for the Revenue has to be accepted. Before we delve into the reasons for coming to such a conclusion the following brief facts, which are necessary for disposal of the present appeal, require to be noted. transpires, that the assessee's return was picked up for scrutiny and accordingly, a notice under s. 143(2) of the Act dt. that the assessee had received interest on fixed deposit amounting to Rs. 1,51,869 which the assessee had shown as 'business income'. had to be treated as 'income from other sources' and accordingly, deduction under s. 80HHC of the Act, on the interest income, was disallowed.