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Classification of interest earned on building advance deposit

Venkatramana Shastry C (Student CA Final ) (90 Points)

20 November 2020

An assessee having rental income by way of letting out shops in a commercial complex earned 100000 Rs. Interest on building advance deposit in a year. My query is regarding the nature of interest earned as it is incidental to such property letting out. Is it to be classified as business income or other source?

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4 Replies

JATINDER KUMAR (Accountant) (3662 Points)
Replied 20 November 2020

Other sources

Venkatramana Shastry C (Student CA Final ) (90 Points)
Replied 20 November 2020

Originally posted by : JATINDER KUMAR
	Other sources

Can you please explain in detail...!?

JATINDER KUMAR (Accountant) (3662 Points)
Replied 20 November 2020

@ Mr. Venkatramana , this type of income not consider as business income

CA PARTH SHAH (In Practice) (1951 Points)
Replied 23 November 2020

What is the nature of business activity of the assessee? If the assessee is in the business of letting out of property then it can be considered as Business income. Otherwise it has to be consdered as Other Sourse Income.