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2022 (3) TMI 673 - ITAT DELHITDS u/s 194A - non-deduction of TDS for interest paid to Barclays Investment & Loan (India) Ltd - HELD THAT:- It is explained by the assessee that the lender company has closed its operation in India, therefore, appellant could not lay hand on the certificate issued u/s 201 of the Act. Though appellant succeeded to get certificates from the two other lenders and placing it before the Ld. First Appellate Authority to get part relief. This Bench is of considered view that the appellant needs an opportunity to bring on record the other sources of information or documents to establish if certificate was issued by Barclays Investment and Loan (India) Ltd. Accordingly, the AO is directed to conduct a proper inquiry in that regard including giving opportunity to the assessee. Consequently ground no. 1 is determined in favour of the assessee for statistical purpose. Disallowance of interest on the advances made by the assessee - HELD THAT:- There is no reason to differ. All the machinery for which the advance was given were part of the replacement machinery and said machineries for which the advance was given was not for extension of existing business. The Bench is thus inclined to decided this ground in favour of the assessee. Addition u/s 37(1) of difference in the rate of interest - HELD THAT:- It can be observed that the assessee has paid bill discounting charges 15 and 16% to Sandhar Automotavies (Dhumspur) and 19% to Sandhar Enterprises. While as per the own case of assessee they are connected enterprises of one proprietor. Thus, the Ld. First Appellate Authority has rightly disallowed amount being not based on principles of prudence and considering them excessively paid. Even otherwise, admittedly, in assessee’s own case for the year 2012-13, the Co-ordinate Bench has also determined the issue against the assessee and meeting the similar fate, in the present appeal, ground no. 3 is determined against the assessee. Addition u/s 37(1) - HELD THAT:- Sanction letter placed on record by the assessee makes it apparent the loan of the 70,00,000/- , taken from SIDBI was to meet margin money for working capital requirement of the company. The interest on this loan stands allowed by the Ld. AO as revenue expenditure that being so there could be no justification to disallow the process charges made for procuring the loan as capital expenditure. Thus, only to the extent of ₹ 78,652/- impugned addition of total ₹ 2,42,136/- is liable to be set aside. Accordingly this ground is allowed part.
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