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2020 (11) TMI 857 - AT - Income TaxDisallowance u/s. 36(i)(iii) - interest expenditure in respect of interest free advances/payments made by the assessee to different parties - HELD THAT:- The issue is squarely covered by the various decisions of the High Courts as well as of the apex court of the country holding that if the assessee is possessed of sufficient own interest free funds to meet the investments/interest free advances, then, under the circumstances, presumption will be that interest free advances/investments have been made by the assessee out of own funds/interest free funds. Reliance in this respect can also be placed on the decision of the Hon'ble Supreme Court in the case of 'Hero Cycles (P) Ltd. [2015 (11) TMI 1314 - SUPREME COURT ] and in the case of 'CIT (LTU) Vs. Reliance Industries Ltd. [2019 (1) TMI 757 - SUPREME COURT] - Thus, as per the settled law no disallowance u/s. 36(i)(iii) of the Act is warranted on this issue. The disallowance made by the AO on this issue is ordered to be deleted. The issue is accordingly allowed in favour of the assessee.
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