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2015 (11) TMI 1704 - AT - Income TaxDisallowance of interest on loan - interest added back on the ground that the diversion of loans made for non-business purposes - Held that: - the decision in the case of The Commissioner of Income Tax Versus Reliance Utilities & Power Ltd. [2009 (1) TMI 4 - BOMBAY HIGH COURT] followed, where it was held that The principle, therefore, would be that if there are funds available both interest-free and over draft and/or loans taken, then a presumption would arise that investments would be out of the interest-free fund generated or available with the company, if the interest-free funds were sufficient to meet the investments - addition not justified. Disallowance of Bad Debts - case of Revenue is that conditions of subsection (2) of section 36 have not been fulfilled - Held that: - The Hon’ble High Court of Karnataka in the case of Krone Communication Ltd., [2010 (7) TMI 631 - Karnataka High Court] decided the issue in favor of the assessee, following the decision of the Hon’ble Supreme Court in the case of T.R.F. Ltd., [2010 (2) TMI 211 - SUPREME COURT] wherein it was held that after 1.4.1989, it was not necessary for the assessee to establish that the debt, in fact, has become irrecoverable; it is enough if the bad debt is written off as irrecoverable in the accounts of the assessee - addition not justified. Appeal dismissed - decided against Revenue.
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