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2016 (1) TMI 1125 - AT - Income TaxDisallowance of ‘Finance & Interest Charges’ - disallowance u/s 36(1)(iii) - Held that:- AO has failed to follow the direct decision of Hon'ble Bombay High Court in the case of CIT vs. Reliance Utilities and Power Limited, (2009 (1) TMI 4 - BOMBAY HIGH COURT) wherein it is held that where the assessee possessed sufficient interest free funds of its own which were generated in the course of the relevant financial year, part from substantial shareholders funds, presumption sands established that the investment in sister concerns were made by the assessee out of interest-free funds and therefore no part of interest on borrowings can be disallowed on the basis that the investments were made out of interest bearing funds. The addition made by the Id. AO is not sustainable on the facts and in law and therefore the addition made be deleted.
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