The assessee a joint-venture company formed for the purposes of ensuing adequate and dependable coal supply. The assessee received certain funds from its promoter companies for a specific purpose of acquiring and developing coal mines overseas. During the negotiation period the funds were kept in short term fixed deposits yielding interest income. The AO treated the interest income as income from other sources. The Tribunal allowed the claim. On appeal, dismissing the appeal of the Revenue, the Court held that the funds were received and earmarked for the purposes of the acquisition of a coal mine overseas. Thus, the interest received on borrowed funds was a part of the capital cost and was required to be capitalized as capital work-in-progress.(AY. 2012-13)