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2017 (7) TMI 102 - AT - Income TaxDisallowance of notional interest expenses - addition u/s 36(1)(iii)- Held that:- As gone through the facts in entirety and notice that this advance amount of ₹ 85,73,303/- is on margin fund and moreover the assessee is having its interest free funds in the shape of share capital of ₹ 7.15 crore and unsecured loan of ₹ 10.71 crore available with its interest free. Thus no disallowance at all can be attributed to the assessee on account of diversion of funds. Accordingly, this issue of Revenue’s appeal is dismissed. Addition of unexplained cash credit - Held that:- The name of the creditor was not reflected in the records of the Department data base. Accordingly, a letter under section 133(6) was issued by this office asking the company to conform whether it has given the loan to the appellant company. No reply to the enquiry letter was received in spite of a lapse of considerable time. It is to be noted that the letter was duly served at the given address. In view of these facts the appellant has not been able to give satisfactory evidence regarding the existence and creditworthiness of the creditor from home it has taken a loan of ₹ 56 Lacs. The addition made by the AO for this loan under section 68 is therefore, upheld. Disallowance of depreciation of car - Held that:- Car was purchased out of the funds of the assessee company and also used for the business purposes of the assessee company only. To prove this point assessee produced complete audit accounts and balance sheet for the year ended 31-03-2007. The assessee has disclosed this car in the business asset and claimed depreciation. We find in the exactly similar circumstanced coordinate Bench of this Tribunal in the case of Mehta Equities Ltd. v. The ACIT [2016 (11) TMI 358 - ITAT MUMBAI] for the assessment year 2010-11 vide order dated 21-09-2016 has allowed the claim of depreciation wherein the car was purchased in the name of one of the director of the assessee company
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