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Order u/s.254(1)of the Income-tax Act,1961(Act) लेखा सद�य लेखा सद�य राजे�� राजे�� केकेकेके अनुसार अनुसार PER RAJENDRA, AM- लेखा लेखा सद�य सद�य राजे�� राजे�� अनुसार अनुसार Challenging the order,dated 12.07.2012 of CIT(A)-9,Mumbai,the Assessee has filed the present appeal.Assesse-company,engaged in the shipping business,filed its return of income on 26.09.2011,declaring total income at Rs.1,63,38,590/-.The Assessing Officer (A.O.) passed the assessment order u/s. 143(3) of the Act,was passed on 12.12.2011,determining the total income of the assessee at Rs.2.48 crores under the normal provisions of the Act. Under the MAT provisions the income was assessed at Rs.8.33 crores.
The effective Ground of appeal is about taxation of interest income of Rs.1.53 crores as income from other sources. During the assessment proceedings the AO held that interest on FD.s and dividends received by the assessee could not be said to be derived from shipping business. He therefore,taxed the interest income under the head income from other sources. 3.Aggrieved by the order of the AO, the assessee preferred an appeal before the First Appellate Authority (FAA).Before him,the assessee contended that AO had wrongly taxed the interest income under the head ‘interest from other sources’. 3.1FAA referred to order of his predecessor for the AY.2008-09 and the order passed by the AO u/s.154 of the Act on 13.3.12. With regard to the interest income the FAA relied upon the case of Godavari Sugar Mills (191 ITR359 and Sameer Diamonds Export (254ITR548), Sterling Foods (237 ITR579) and Liberty India (317 ITR 218) and held that Interest income was not derived from the business and was to be taxed under the head income from other
6299-Pratibha sources.Referring to the case of Asian Star Co. Ltd. (326ITR356), he upheld the order of the AO. 4.Before us,none appeared,on behalf of the assessee, as stated earlier.The Departmental Representative (DR) supported the order of the FAA. 5.We have perused the available material on record.We find that the AO had taxed the interest income under the head income from other sources,that both the authorities were of the opinion that the interest income had no direct nexus with the business of the assessee.We find that the FAA had relied upon the various judgments,wherein the stand taken by the AO has been upheld.The assessee has not produced anything before the AO/FAA that proves that the interest income earned by it had nexus with the business.Therefore,in our opinion the order of the FAA does not suffer from any legal or factual infirmity.Confirming his order,we are deciding the effective ground of appeal against the assessee.