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2019 (12) TMI 661 - AT - Income TaxInterest free loans to sister concerns - HELD THAT:- Hon’ble Apex Court in the case of CIT vs. Reliance Industries Ltd. [2019 (1) TMI 757 - SUPREME COURT] has affirmed the view of the High Court to the effect that if the interest free funds available to the assessee were sufficient to meet its investment, then it could be presumed that the investment were made from the interest free funds available with the assessee. The Apex Court in the case of Hero Cycles Ltd. [2015 (11) TMI 1314 - SUPREME COURT] also analyzed laid down the same dictum. In the instant case, the interest free funds available with the assessee were more than the advance paid to its sister concerns, therefore the issue in hand remanded to the file of AO to decide accordingly as per dictum of the Hon’ble Apex Court. Ground No.1 & 2 are co-related and hence allowed for statistical purposes. Interest subsidy by the Revenue Authorities as Revenue receipt - HELD THAT:- CIT(A) has correctly observed that the appellant has himself shown the amount of interest subsidy as Revenue Receipt however, it is a fact that as per the judgment of jurisdictional High Court in the case of Sh. Balaji Alloys (supra), the interest subsidy has been treated as Revenue receipt, hence in view of the same, the Assessing Officer is directed to consider this aspect afresh while following the judgment of the Jurisdictional High Court in the case of Sh. Balaji Alloys [2011 (1) TMI 394 - JAMMU AND KASHMIR HIGH COURT] Disallowance of Bank Interest expenses will decrease the (claimed) loss of the assessee, but will also increase deduction u/s 80-IB - HELD THAT:- As in the case of Sunandan Aggarwal Vs. ITO, Jammu [2016 (2) TMI 1266 - ITAT AMRITSAR] the disallowances of interest shall result in decrease of loss and therefore, cannot be treated as taxable income as the same will not change the amount of deduction u/s 80-IB of the Act. In the interest of justice, in our considered view, it would be appropriate to remand the instant issue to the file of Assessing Officer for decision afresh as per dictum of aforesaid tribunal's judgments. Hence, revised ground No.4 also stands allowed for statistical purposes.
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