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2012 (7) TMI 434 - ITAT, DELHIDis allowance of interest as business expenditure - Held that:- CIT(A) had rightly deleted the addition on account of interest paid as interest free loans and advances to sister concern given by the assessee before taking borrowings cannot come in the way of allowing interest paid on borrowings taken by the company as in the present case, there was fresh borrowings of Rs. 6,00,00,000/- whereas loans and advances are continuing from the previous year. Disallowance of administrative & other expenses - assessee is earning income from business, from short term capital gain, long term capital gain and from interest income - Held that:- Long term investments of the assessee constitute a significant portion of total investments, the income from which is exempt either as dividend or long term capital gain. As the portfolio of assessee consists mere of long term, investments than short term investments and therefore 5% disallowance of expenditure upheld by Ld CIT(A) does not seem to be justified - remit the case to the file of the AO to consider to the expenses which could be related to earning of exempt income i.e. long term capital gain and dividend income and recompute the disallowance - partly in favour of revenue.
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