Interest on Surplus Bank FDs Exempt Under Section 10AA: Karnataka HC

PCIT Vs Allstate India Private Limited (Karnataka High Court) In the case of PCIT vs. Allstate India Private Limited, the Karnataka High Court addressed whether interest income earned from surplus funds parked in fixed deposits (FDs) by an exporter in a Special Economic Zone (SEZ) qualifies for exemption under Section 10AA of the Income Tax Act. The Principal Commissioner of Income Tax (PCIT) challenged the Income Tax Appellate Tribunal’s (ITAT) decision that had granted the exemption, arguing that such interest income does not arise directly from export activities and therefore should n...