TMI Blog2010 (2) TMI 1182X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the judgment is distinguishable for any reason. Investments out of the interest free funds - HELD THAT:- Following the judgment of the Division Bench in CIT vs. Reliance Utilities and Power Ltd.,[ 2009 (1) TMI 4 - BOMBAY HIGH COURT] , the Tribunal held that if the Assessee had funds available, both interest free and loaned, there would be a presumption that the investments were out of the interest free funds if the interest free funds were sufficient to meet the outlay on the investment. In the present case, having regard to the finding of fact that the assessee had sufficient interest free funds, no substantial question of law would arise. Accrual of the income - fixed deposit - The case of the assessee that the interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 10.46 crores was nonincome bearing investment made out of interest paid funds? 3. Whether, on the facts and in the circumstances of the case and in law, the Hon ble Tribunal is right in holding that accrual of the income would be there only when there was a right to receive and such right should be legally enforceable, relying on the judgment of Supreme Court in the case of E.D. Season Co. vs. CIT (26 ITR 27)? 2. In the grounds, as they have been framed, particularly grounds 1 and 3 above, the Revenue seeks to find fault with the Tribunal for relying upon the judgment of this Court in the case of J.K.Investors, 248 ITR 723 (in so far as question 1 is concerned), and upon the judgment of the Supreme Court in E.D.Sassoon and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of fact that the Assessee had its own funds in excess of ₹ 12 crores. The interest which was disallowed by the Assessing Officer pertains to an investment of ₹ 10.52 crores. The Tribunal held that since the interest free funds available with the Assessee were sufficient to meet its investments, it could not be held that the investments were made out of loan funds. Following the judgment of the Division Bench in CIT vs. Reliance Utilities and Power Ltd., (2009) 313 ITR 340 (Bom), the Tribunal held that if the Assessee had funds available, both interest free and loaned, there would be a presumption that the investments were out of the interest free funds if the interest free funds were sufficient to meet the outlay on the investm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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