The assessee received grants from the State of Punjab for certain purposes which included the construction of houses for police officials. The unutilized amount of the grant remained in the bank and earned interest.  The AO assessed the interest as income . CIT (A) affirmed the order of the AO . Appellate Tribunal deleted the addition . On appeal  dismissing the appeal, that the findings of the Assessing Officer were conjectural. The contention of the Department that the absence of any stipulation in the letter releasing the grant to the assessee to the effect that the interest was to be returned to the Government could not lead to the conclusion that the interest was the income of the assessee. It was not the case of the Department that the books of the assessee ever revealed the diversion of any interest income.