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2014 (10) TMI 1018 - ITAT MUMBAIExemption u/s 10(23G) - AO’s reasons for denying the claim that the assessee has not classified the loans as investments and further those companies have not invited funds by open offer from the public - HELD THAT:- As decided in RABO INDIA FINANCES LTD. [2012 (4) TMI 772 - BOMBAY HIGH COURT] allowed the claim of the assessee on noticing that the deduction u/s 10(23G) is being allowed consistently from the assessment year 2002-03 onwards. AO’s reasons for denying the claim that the assessee has not classified the loans as investments and further those companies have not invited funds by open offer from the public are not material as classification of amounts in the books of accounts are not a criteria, for considering the long term finance given by the assessee and further there is no stipulation that there should be an open offer in inviting long term finance under the rules. The conditions considered by the AO are not supported by the provisions of the Act and therefore the AO’s action in denying the claim on infructuous reasons cannot be upheld. Interest u/s 234D - Whether interest would not arise, if both the additions made by the AO are deleted?- HELD THAT:- In the earlier paragraphs, we have directed the AO to allow the exemption u/s 10(23G) of the Act and further disallowance of interest has since been rectified by the AO in the order passed u/s 144 of the Act. Hence, as agreed by both the parties, the question of charging interest u/s 234D would not arise. Accordingly, we reject the ground urged by the revenue.
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