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2017 (4) TMI 610 - AT - Income TaxDisallowance of interest paid from personal Account - Held that:- Assessee could have taken loan for commodity business and should not have utilized loan taken in personal capacity. I find that this adverse inference is devoid of cogency. Assessee has raised loan and used it for business purpose. Revenue authorities cannot sit into the shoes of the businessman and direct as to from where he should raise the loan. Secondly the assesse has interest bearing as well as interest free funds. In the said circumstances it is the settled law that it is up to the assessee to attribute the source of investment if interest free and interest bearing funds are available. The assessee can very well attribute the interest free funds for other purpose and interest bearing funds for the business purpose. Hence adverse inference drawn by the authorities below is not also sustainable on this issue. It is not the case of the revenue that interest free funds were not sufficient to meet the amount spent on acquisition of other assets. Hence attribution of the authorities below that interest bearing funds were not used for business purpose cannot be sustained. Accordingly, set aside the order of the authorities below and decide the issue in favour of the assessee. 15% disallowance out of various expenses debited in Profit & Loss Account - addition on the ground that all the expenditures were not supported by complete expenditure bills and vouchers hence he made an adhoc disallowance of 15% - Held that:- Assessing Officer has made the disallowance on adhoc basis. He has not brought on record specific vouchers and the defects therein. However this fact also cannot be ruled out that the expenditures were not fully backed by proper external vouchers. In these circumstances in my considered opinion the disallowance of 5% of the expenditure involved would serve the end of justice. Learned counsel of the assessee fairly agreed to this proposition. Accordingly, direct that disallowance be restricted to 5% of the expenditure. - Decided partly in favour of assessee
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