S. 40(b) Interest on deposits for availing bank guarantee is business income

S. 40(b) Interest on deposits for availing bank guarantee is business income includible in ‘book profit’  

It is the purpose or the proximity to the purpose, which would determine the character of the asset and, thus, that of the income arising there-from and, consequently, its assessability under the Act, going on to hold that where the amount was deposited in the bank to obtain a letter of credit for purchase of a capital asset (machinery), the interest thereon would only be a capital receipt

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