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2012 (8) TMI 985 - AT - Income TaxAssessment u/s 153A - Held that:- The addition in such a case can only be made on the basis of incriminating material found in the course of search and in the instant case, from the perusal of the assessment order as well as the order of CIT(A), it is seen that the disallowance on interest, which has been made, is not based on any seized material or documents found during the course of search and seizure. Therefore, such a disallowance be deleted. Disallowance of interest - Held that:- No reason to deviate from the findings given by the CIT(A) as admittedly the borrowed funds cannot be held to be utilised wholly and exclusively for the business purpose. The investment in the company, wherein the assessee is a Director, will result only in dividend income which undoubtedly, would be hit by Section 14A. Nothing has been brought on record that by lending the money to the company by the assessee, from his own borrowed funds, has any direct or indirect nexus for the business purpose of the assessee. Therefore, in our opinion, there is no merit in the contention raised by the assessee and accordingly, we uphold the order of the CIT(A) and dismiss both the appeals filed by the assessee for the assessment years 2005-06 & 2006-2007, respectively.
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