Interest on funds which are to be deployed for construction of plant in future cannot be treated as Income

Ms. Bank Note paper Mill India Pvt. Ltd Vs ITO (ITAT Bangalore)  ITAT held that where the interest receipt is directly connected or incidental to working of construction of assessee plant, it should be reduced from the capital cost of project and not be treated as income. Statement provided by assesse in form of Annexure proves the inextricable link between the interest income earned and project expenditure. The hon’ble ITAT observed that the decision of the Hon’ble Supreme Court in Tuticorin Alkali Chemicals & Fertilizers Ltd. 227 ITR 1721 was distinguished by the Hon’ble Supreme C...