Pramod Kumar, Accountant Member. - The common issue that we are required to adjudicate in both of these appeals is whether or not the CIT(A) was justified in holding that interest received by the assessee on staff loans, on the facts of the case, is taxable as ‘income from other sources’. The impugned assessments were framed under section 143(3) read with section 254 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’), the assessment years involved are 1998-99 and 1999-2000 and the quantum of interest for these assessment years is Rs. 1,25,487 and Rs. 1,14,244 respectively.

2. The issue in appeal lies in a very narrow compass of undisputed material facts. This is second round of proceedings. In the first round of assessment proceedings, the interest income earned by the assessee was held to be taxable under the head ‘Income from other sources’. The assessee’s claim that it should be adjusted against the expenditure to be capitalized. The dispute travelled upto the Tribunal. The assessee’s contention was that this income is incidental to the business of real estate development, and, therefore, it should be set off against the expenses to be capitalized. The Tribun