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2014 (7) TMI 1282 - AT - Income TaxAddition u/s. 36(1)(iii) - interest free advances and outstanding advances - commercial expediency - Held that:- We find that there was opening debit balance of ₹ 4413287/- in case of Jay Ess Exports. No doubt certain purchases have been made from this party but for making purchases fresh payments have been made to this party and at all relevant time, the debit balances has rather increased during the year. We asked the assessee whether any disallowance was made in the earlier year and he admitted that disallowance was made with reference to the debit balance in case of Jay Ess Exports which was not challenged by the assessee. Assessee could not point out why huge advances have to be given to this party at all times, therefore in our opinion, the commercial expediency can not be inferred in this case - Decided against assessee.
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