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2016 (9) TMI 1583 - HC - Income TaxAdditions u/s 16 (8) - income returned by the assessee/respondent - AO added amounts advanced by 18 unsecured creditors - revenue argues that the approach of the CIT (A) and the ITAT was incorrect because the assessee did not produce further details apart from the bank account particulars and the documents furnished - HELD THAT:- This court is unpersuaded with these submissions. Reading of the order of CIT (A) shows that remand specifically was sought; after considering the remand report and submission of both the parties, the CIT (A) was satisfied that the documents particularly the bank accounts statements revealed that the creditors were not fictitious but rather had genuine accounts and that they were also filing income tax returns. Given the factual nature of these findings, the court is of the opinion that the proper test to discern the identity genuineness of the transaction and the credit worthiness of parties lending the amount – as required by law, especially in Commissioner of Income Tax vs. Lovely Export (P) Ltd. [2008 (1) TMI 575 - SC ORDER] has been followed. No question of law arises. Disallowance of interest on the borrowings used for acquisition of non-business assets and non-business purposes - HELD THAT:- The court notices that CIT(A) had modified the findings after an overall appreciation of the facts. Instead of initial disallowance – which was in excess of ₹ 55 lacs, the appellate commissioner brought down the figure of disallowance to ₹ 3.69 lacs. That has been affirmed by the ITAT. Besides being entirely factual, the court is of the opinion that the AO‟s order itself is silent on the particulars as to the advances attributable to the specific assets upon which interest was sought to be disallowed on three counts. No question of law arises on this aspect as well.
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