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2014 (3) TMI 105 - AT - Income TaxDeletion of disallowance of interest expenses Held that:- CIT(A) held that the disallowance of interest is deleted by holding that the borrowed funds have been used for specific purpose of acquiring assets and the availability of surplus funds in making the advances in dispute cannot be disbelieved - the major part of advances was for trading security and balance advances were in any case covered by the availability of interest free funds - CIT(A) while deleting the addition has noted that A.O. has not disputed that the interest free loans were given in earlier years and there was no fresh advances during the year - He has further given a finding of fact that there is absence of direct nexus between the interest free advance given and the loan raised and that the major part of advances was for trading security and the balance advances were covered by the availability of interest free funds revenue has not brought any material on record to controvert the findings of CIT(A) thus, there is no reason to interfere with the order of CIT(A) Decided against Revenue. Deletion of unutilized MODVAT credit as income Held that:- CIT(A) while deleting the addition made by the A.O. has noted that in assessment year 02-03 similar addition was made by A.O. and the same was deleted by CIT(A) - CIT(A) has further noted that since the facts of the year under consideration were similar to that of A.Y. 02-03 & 03-04, following the decision of Tribunal, the addition made by the A.O. was deleted revenue could not controvert the findings of CIT(A) nor has brought any material in its support thus, there is no reason to interfere with the order of CIT(A) Decided against Revenue.
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