M/s. The Government Tele Communication Employees Co-operative Society Limited Vs. The Income Tax Officer, Non-Corporate Ward 11(1), Chennai

Parties Involved

Facts Summary

This appeal was filed by the assessee, M/s. The Government Tele Communication Employees Co-operative Society Limited, against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 31.07.2024. The relevant Assessment Year is 2017-18. The assessee had originally filed multiple sets of grounds of appeal, but later decided to press only two specific grounds (Nos. 6 and 8) related to the computation of interest on fixed deposits and savings bank interest. The assessee argued that it is entitled to set-off interest expenditure against the interest received, as there is a direct nexus between the interest payment and interest receipts. The Tribunal had previously dealt with similar issues in the assessee’s cases for assessment years 2012-13 to 2016-17.…

Legal Issues

• 1. Whether the Assessing Officer is correct in computing the interest on fixed deposits and savings bank interest without allowing deduction towards proportionate interest paid on borrowings.
• 2. Whether the correct income under these sources should be computed after allowing interest paid against interest receipts.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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