JUDGMENT judgment of court was delivered by L. Narasimha Reddy J.-The respondent is industrial undertaking. In its returns submitted for assessment year 1993-94, it claimed deduction under section 80HH of Income-tax Act, 1961 (for short "the Act"), for sum of Rs. 20,40,341. According to it, said amount represents interest on belated payment of purchasers of product manufactured by it. In his order of assessment, dated March 15, 1996, Assessing Officer disallowed deduction by treating it as not qualified under section 80HH of Act. respondent filed appeal before Commissioner of Income-tax (Appeals). appeal was allowed through order, dated July 10, 1996. Aggrieved by that, Revenue filed I. T. A. No. 1671/Hyd/96 before Hyderabad Bench of Income-tax Appellate Tribunal. appeal was dismissed through order dated May 29, 2001. Hence, this further appeal under section 260A of Act by Revenue. following substantial question of law is canvassed before this court: "Whether, on facts and in circumstances of case, Tribunal is correct in law in holding that interest earned from trade debtors on account of delayed payment should be treated as profits'derived from' industrial undertaking of assessee for purpose of computing relief under section 80HH of Income-tax Act, 1961?" Sri J. V. Prasad, learned counsel for appellant, submits that profits and gains, that are derived by respondent from activity of manufacture of cold roll strips alone, that qualify for deduction, to extent of 20 per cent. under section 80HH of Act and interest on belated payment does not at all fall into that category. He submits that it is only cost of product manufactured and sold by respondent that becomes income, and thereby, profit, referable to section 80HH of Act and not interest on belated payment. He also submits that Assessing Officer has analysed matter with reference to relevant facts but Commissioner of Income-tax (Appeals) and Tribunal have taken hypertechnical view of matter. Reliance is placed upon judgment of Supreme Court in Pandian Chemicals Ltd. v. CIT [2003] 262 ITR 278 (SC). Sri Y. Ratnakar, learned counsel for respondent, on other hand, submits that it is well-known trade practice to supply goods on credit and to receive consideration with interest for belated payment and interest becomes part of sale consideration. He submits that whether one goes by trade practice or mandate under section 61 of Sale of Goods Act, 1930, interest becomes inseparable part of consideration. Learned counsel further submits that subject matter of judgment of Supreme Court in Pandian Chemicals Ltd.'s case (supra), is incomparably different from that of present case. He has relied upon judgment of Supreme Court in CIT v. Govinda Choudhury and Sons [1993] 203 ITR 881 (SC) and of Karnataka High Court in CIT v. Sri Hariram Hotels P. Ltd. [2010] 325 ITR 136 (Karn). Chapter VI-A of Act provides for deduction of profits and gains of stipulated fraction from income derived from concerned activity. effort of Parliament is to encourage industrialists and entrepreneurs to undertake activity, which in turn may add to economy of nation. common phrases that occur in all these provisions that occur in Chapter VI-A of Act particularly under heading "C-Deduction in respect of certain incomes", is where gross total income of assessee includes any profits and gains derived "from concerned activity", there shall, in accordance with and subject to provisions of section, be allowed, in computing total income of assessee, deduction from such profits and gains of amount equal to 20 per cent. thereof. Almost all principal sections, which provide for deductions, employ this language and details as to deduction or definition of activity are supplemented in sub-sections or clauses thereof. Sub-section (1) of section 80HH of Act reads as under: "Where gross total income of assessee includes any profits and gains derived from industrial undertaking, or business of hotel, to which this section applies, there shall, in accordance with and subject to provisions of this section, be allowed, in computing total income of assessee, deduction from such profits and gains of amount equal to twenty per cent. thereof." expression "derived from" that occurs in quite large number of sections of Act has been subject matter of interpretation by several High Courts and Supreme Court. It is not uncommon that assessee would have several sources of income and there may be tendency to derive benefit of deduction provided for under particular provision; in respect of incomes, which genuinely do not fall into that category. Equally attentive Assessing Officers would scrutinise matter and disallow claims, if, according to them, they do not partake of same character as enunciated in particular provision. facts of present case do not pose much of difficulty. Unlike in several other cases, assessee in instant case was undertaking only one activity, viz., manufacture of cold roll strips. income posted by him in income-tax returns comprised mostly of sale proceeds of product manufactured by it. books of account revealed consideration that is received for product that is sold from time to time. Wherever payment was made at subsequent stage, and purchaser paid interest thereon, as per terms of sale, actual sale consideration and component of interest were shown separately. Honestly enough, respondent has shown actual consideration of product manufactured and sold by it on one hand and interest received by it on account of belated payment of consideration by purchasers, on other hand. interest component aggregated to Rs. 20,40,341 for concerned assessment year. Assessing Officer treated this as not falling within ambit of section 80HH of Act. income of manufacturer of particular item is mostly in form of receipt of sale consideration. What constitutes consideration, is not susceptible of any precise definition. Though on strict financial discipline, one may determine cost of product by taking into account factors such as cost of raw material, cost of manufacture (which may take in its fold, expenditure incurred towards establishment and power and wages to workers), component of taxes and margin of profit. Many time, several external factors influence determination of price, requiring upward or downward revision. For instance, if cost of product is determined on scientific lines to be at Rs. 1,000 per unit, all surrounding circumstances being normal, manufacturer may sell it at same price. However, if there is slump in demand, occasion may arise to offer discount on it, in which case, price may stand reduced. Conversely, if demand is heavy and supply is less, premium may accrue to product and depending upon financial status and discipline of manufacturer or trader, product may be sold at phenomenally higher price. Whatever may be fluctuations in trade in relation to product, what becomes relevant from point of view of section 80HH of Act is profit and gain, which assessee has derived from activity. Whether to promote sales or to ensure that stock, which has piled up in particular period is cleared, or to accommodate regular customer, manufacturer may offer sale of product on credit, subject to payment of interest for belated payment. Even these aspects become almost irrelevant in context of section 80HH of Act and what becomes material is actual amount that is received by manufacturer. Not only from point of view of section 80HH of Act but also in ordinary parlance, interest paid by purchaser on account of belated payment, becomes part of consideration and partakes of character of price. Another way of looking at matter is as to what was occasion or basis for person to pay amount representing interest. answer would connect same to product and one does not have to put any further questions to relate same, to activity of assessee. This fits into observation of Privy Council in CIT v. Raja Bahadur Kamakhaya Narayan Singh [1948] 16 ITR 325 (PC), which reads (page 328): "The word'derived' is not term of art. Its use in definition indeed demands enquiry into genealogy of product. But enquiry should stop as soon as effective source is discovered. In genealogical tree of interest land indeed appears in second degree, but immediate and effective source is rent, which has suffered accident of non-payment. And rent is not land within meaning of definition." rent is not land within meaning of definition." In Govinda Choudhury and Sons' case (supra), hon'ble Supreme Court observed in this context as under (page 884): "It is well-settled that interest can be assessed under head 'Income from other sources' only if it cannot be brought within one or other of specific heads of charges. We find it difficult to comprehend how interest receipts by assessee can be treated as receipts which flow to him de hors business which is carried on by him. In our view, interest payable to him certainly partakes of same character as receipts for payment of which he was otherwise entitled under contract and which payment has been delayed as result of certain disputes between parties. It cannot be separated from other amounts granted to assessee under awards and treated as income from other sources. second question is, therefore, answered in favour of assessee and against Revenue." Learned counsel for appellant relied upon judgment of Supreme Court in Pandian Chemicals Ltd.'s case (supra). In that case, assessee sought to add to his income derived from manufacture of chemicals, interest which was paid by electricity supplier on deposits made by assessee. Supreme Court held that hardly there exists any nexus between two. There is not even remote possibility to apply ratio laid down in that case to facts of present case. It is different matter that Assessing Officer can certainly verify as to whether interest was in fact paid or whether it was claimed on imaginary or surreptitious manner. In given case, if it is found that consideration was paid at time of sale itself and still, interest on it was sought to be added, necessary steps can be taken in this behalf. We do not find any basis to interfere with order passed by Tribunal. Therefore, appeal is dismissed. miscellaneous petition filed in this appeal shall also stand disposed of. There shall be no order as to costs. *** Commissioner of Income-tax v. Surana Strips Ltd.