The Tax Publishers2020 TaxPub(DT) 5133 (Mum-Trib)

INCOME TAX ACT, 1961

Section 14

Since assessee was registered as NBFC with RBI and would earn interest income by advancing loans, the activity of said advancing loans, in such a case, would become assessee's business and naturally, the interest earned thereupon would constitute business income for the assessee.

Head of income - Business income or Capital gains - Interest income -

Assessee was a non-banking financial company (NBFC). It earned interest income which was assessed under the head 'Income from other sources' as against business income offered by assessee. Held: Assessee was registered as NBFC with RBI and would earn interest income by advancing loans. The activity of advancing loans, in such a case, would become assessee's business and naturally, the interest earned thereupon would constitute business income for the assessee. In fact, it was the plea that such income was always offered to tax as business income and the said treatment was never disturbed. The rule of consistency would demand that there being no change, in facts or circumstances, the accepted position should not be disturbed.

REFERRED :

FAVOUR : In favour of assessee.

A.Y. : 2013-14



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