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2016 (8) TMI 56 - ITAT MUMBAIAddition u/s 14A - Held that:- As during the year under consideration, assessee has not earned any exempt income in order to invoke the provisions of section 14A of the Act. Thus we find no reason to uphold the impugned disallowance made by the income tax authorities by invoking section 14A of the Act - Decided in favour of assessee Addition invoking the provisions of section 36(1)(iii) - Held that:- Following the judgment of Hon'ble Bombay High Court in the case Reliance Utilities And Power Limited (2009 (1) TMI 4 - BOMBAY HIGH COURT ), it can be presumed that no borrowed funds were used to make such investments. As per Hon'ble Bombay High Court, the principle is that, if there are funds available both interest free and interest bearing, then a presumption can be drawn that investments are made out of interest free funds, so long as such interest free funds are sufficient to meet the investments. In our considered opinion, having regard to the fact position brought out by the CIT(A), the proposition laid down by the Hon'ble Bombay High Court in the case of Reliance Utilities And Power Limited(supra) is fully attracted in the present case. Such fact-situation has been enumerated by the CIT(A) in Para 3.4 of his order, which depicts the summarized fund flow position of the assessee, and the same has not been controverted by the Revenue before us, rather the same is also borne out of the material placed in the Paper Book filed before us. Therefore, on this count itself, we find no reason to interfere with the ultimate conclusion of the CIT(A) in deleting the addition - Decided in favour of assessee
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