No Tax on Interest accrued on Govt grant received for construction of house for Police

PCIT Vs Punjab Police Housing Corporation Ltd. (Punjab and Haryana High Court) The brief facts are that the Assessee is regularly given grants by the State of Punjab for various purposes including the construction of houses for police officials. It so happens that in a particular year the grant remains un-utilized and the money which is parked in the bank earns interest. As per the Assessing Officer this interest was exigible to tax whereas the Commissioner and the Tribunal held otherwise. The basis for the Tribunal’s decision is that the amount of interest which accrues on any money par...