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2017 (1) TMI 1152 - AT - Income TaxDisallowance of interest u/s 36 - addition made on the plea that borrowed fund was utilised for non–business purpose - Held that:- We find that the assessee has started real estate development business and treated the Jaipur property as current asset in the Balance Sheet. The Board of Directors of the company have also passed a resolution to that effect in the meeting of the company and accordingly, it was shown as current assets in the Balance Sheet w.e.r. 1st April 2009. We also find that in subsequent assessment year, this property was sold and profit earned on the same was offered by the assessee as business income. Once the income from the said property has been offered as business income, there is no reason to disallow the interest paid for acquiring the said property which was held by the assessee as current asset in its Balance Sheet and income from which has been offered as business income. Accordingly, we do not find any merit in disallowance of interest so made.- Decided in favour of assessee Addition of sundry debtors - addition on advance payment received from National Laminates Corporation - Held that:- Ledger account of this party reveals a fact that throughout the year there is a purchase and sale of goods and receipt of advance and at the end of the financial year there was a closing balance of ₹ 34,15,666. We also find that the Balance Sheet of National Laminates Corporation reveals the fact of credit in the name of the assessee. Accordingly, there is no justification for adding this amount as unexplained credit.National Laminates Corporation is a regular assessee and filing return of income regularly. Under these facts and circumstances, we do not find any reason to interfere with the order of the learned Commissioner (Appeals) deleting the addition - Decided in favour of assessee
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