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2013 (8) TMI 1020 - ITAT MUMBAIDisallowance u/s 14A r.w. Rule-8D - Expenditure incurred towards exempt income - Assessee is a company engaged in the business of investment and trading. AO observed that the assessee has received loans from the shareholders and in turn, extended said loan to three of the companies, of which two of them are group concerns, thus assessee is not engaged in the business of money lending. Therefore, the AO treated the ‘interest income’ as ‘income from other sources'. HELD THAT : - Interest earned on money lending operation arose from a systematic and organized activity carried on with a motive of profit and hence ought to be taxed under the head “profits and gains of business or profession’'. Decision in the case of - NARAIN SWADESHI WEAVING MILLS VERSUS COMMISSIONER OF EXCESS PROFITS TAX [1954 (10) TMI 11 - SUPREME COURT], relied upon.
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