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2023 (2) TMI 913 - ITAT KOLKATADisallowance of interest paid - Interest free advances - AO made the disallowance alleging that on one hand the assessee has given interest free advances and on the other hand, it is claiming interest expenditure on unsecured loans taken - HELD THAT:- Sale consideration has been received but payments have not been made to the sundry creditors, cannot be questioned by the revenue authorities and the same depends on the credit limit available for making payments to the sundry creditors and the time of receiving amount from sale of goods and one cannot ignore the situation if sales are realised in much less period and assessee is left with sufficient time to pay the sundry creditors and during this gap, assessee is possessed with surplus funds, which can be used for other business purposes. Since details have been placed before us, which are part of the audited financial statements and remain uncontroverted, we are inclined to hold that the assessee has sufficient interest free funds available to give interest free funds and, therefore, the ld. CIT(A) was not justified in confirming the disallowance of interest expenditure - Appeal of assessee allowed.
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