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2004 (9) TMI 20 - HC - Income TaxInterest on loan/advances - loan granted to the sister concern nexus between the advances and the assessee's overdraft AO viewed that assessee had utilised interest bearing loans to make the advances to the sister concern and ultimately, considering this aspect, came to the conclusion that interest liability charged to the profit and loss account or to the like after taking a sum of Rs. 10 lakhs pertaining to this advance. Held that it is required to be examined by the Assessing Officer as to what extent the benefit of borrowed funds was granted by way of allowing the advance to the sister concern. It is on that amount that the interest is to be calculated and disallowed. The Assessing Officer will have to calculate the exact time for which the amount was utilised out of the borrowed funds. - we remand the matter to the Assessing Officer
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