No Tax on Interest on mandatory reserves created under Major Ports Trust Act 

PCIT Vs Paradeep Port Trust (Orissa High Court) As regards the deletion of addition of Rs.57 crores under the head of ‘interest accrued on investment on Capital Asset, Replacement Reserve Fund and Development, Repayment of Loan and Contingencies Reserve Fund’, it is pointed out that the Assessee has two statutory reserve funds viz., (i) Replacement, Rehabilitation, Modernization of Capital Assets Reserve and (ii) Reserve for Development, Repayment of Loans and Contingencies. These reserve funds had to be established in terms of Section 90 (1) of the Major Ports Trust Act and the di...