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2018 (12) TMI 1258 - ITAT AHMEDABADDisallowance u/s 14A - Held that:- In views of case of Corrtech Energy Pvt Ltd [2014 (3) TMI 856 - GUJARAT HIGH COURT] and in view of the undisputed factual position that there was no exempt income in the hands of the assessee in the relevant previous year, we uphold the plea of the assessee and delete the impugned disallowance u/s. 14A. The assessee gets the relief accordingly. Disallowance of interest expenditure as capital expenditure on part of loan which was utilised for the purpose of the running business of the company - Held that:- The factual position about interest free funds being far from excess of the funds deployed in the new projects and absence of any factual findings about the diversion of funds is not even disputed by the learned Departmental Representative. The disallowance of interest on the borrowings from the Citi Bank, which is solely based on the assumption that the borrowings from the Citi Bank have been used in the new projects – something which is not burnout from the material on record, is devoid of legally sustainable basis. Learned CIT(A)’s conclusions are based on surmises and conjectures. In the light of these discussions, and bearing in mind entirety of the case, we direct the Assessing Officer to delete the impugned disallowance - Decided in favour of assessee
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