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2014 (1) TMI 384 - AT - Income TaxDeletion of interest expenses – Held that:- The assessee had justifiable reasons for advancing the amounts in its capacity as a prudent businessman - At any rate, notional interest cannot be added to the taxable income - the interest paid by the assessee pertains to the amount of Rs.20 crores borrowed from GE Capital at an interest rate of 7.5% p.a. This amount was directly advanced on the same date to Lakshdeep Investment & Finance Pvt. Ltd. from whom it had received interest @ 10% - no part of the borrowed funds were utilised for giving interest free advances so as to disallow any part of the interest paid by the assessee - The order of the CIT(A) with regard to factum of non-utilisation of the interest bearing funds for giving interest free advances upheld - the Revenue has not able to made out a case for disallowing the claim of interest paid by the assessee – Decided against Revenue.
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