Allowing the  appeal of the assessee the Court held that interest earned from Short Term Deposit Receipts (STDRs) made by appellant to enable it to open Letter of Credit (LoC) for procuring plant and machineries is incidental to such acquisition and should be treated as receipt of a capital nature and not taxed as income. It has to be reduced from the cost of capital assets. Followed  CIT v. Karmal Co-Operative Sugar Mills Ltd  (2000) 243 ITR 2 (SC)   (AY. 1998-99)