Home Highlights February 2019 Year 2019 This

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1. Deduction of interest expenditure incurred on borrowed funds u/s 57 - Interest incurred on borrowed funds utilized for making investment in shares in company of...

2. Interest incurred claimed as a deduction u/s. 57(iii) out of interest earned from mutual funds - In our opinion, unless funds are borrowed for making deposit to earn...

3. Interest expenses claim against the interest income received - It is the nature of the business and all the expenditure incurred in earning the income is allowable...

4. Income from other sources - Deduction of interest expenditure - direction of the CIT – A in restricting the deduction to the extent of income earned of term deposit -...

5. Characterization of income - Determine the nature of interest income earned - mere fact that the deposits were linked with projects would not alter the character of the...

6. Characterization of income - interest earned on ICDs - assessee is not in money lending business - when it is accepted that the assessee has taken a prudent business...

7. Addition u/s 14A r.w.r. 8D - There is no such provision in the statute that no disallowance of expenditure could be made on investments made in the earlier years....

8. Disallowance u/s 14A - Disallowance made on account of interest expenditure - AO has not made any disallowance on account of interest expenditure u/s 14A of the I.T. Act...

9. Disallowance of interest expenditure - The interest income earned by the assessee is from loans and advances given to sister concern which is shown by the assessee to...

10. Disallowance u/s 36(1)(iii) - claim of interest expenditure - The companies GIL and CNIL are subsidiary companies, which clearly indicates that the investment made by...

11. Addition made u/s 69C - Unexplained huge expenditure to earn Agriculture income - once the assessee has not made any investment, the addition made u/s 69C of the Act is illegal.

12. Disallowance u/s 14A - Exempted income - proportionate disallowance of interest paid by the banks for investments made in tax free bonds/ securities which yield tax free...

13. Disallowance u/s 14A read with Rule 8D - In any case, as per section 14A(3) whether or not the assessee has incurred any expenditure for earning exempt income, a part of...

14. Penalty 271(1)(c) - deduction of interest out of ‘income from other sources’ - The AO has admitted the claim of interest expenditure to the extent of interest income and...

15. Claim of Expenditure at the rate of 7.5% of the interest income - Admittedly, there is no specific expenditure incurred to earn the interest income. However, incurring...