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TMI Blog2017 (1) TMI 1162X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal has erred in law and on facts in deleting the addition made on account of bad debt written of Rs. 26,74,708/? B.Whether the Appellate Tribunal has erred in law and on facts in deleting the interest expenditure not incurred for the business purpose of Rs. 1,29,43,122/?" 2.0. The facts leading to the present Tax Appeal in nutshell are as under: 2.1. The assessee filed its return of income for AY 200910 on 29.09.2009 declaring total income at Rs. 34,74,880/. That the scrutiny assessment was framed by the Assessing Officer under Section 143(3) of the Income Tax Act determining the total income at Rs. 2,30,98,688/after making following additions: Particulars Amount (Rs.) Interest income not offered to tax 31,90,550/- Bad Debt Writt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he interest expenditure not incurred for the business purpose of Rs. 1,29,43,122/?" 3.0. We have heard Shri Manish Bhatt, learned counsel for the Revenue and Shri S.N.Divatia, learned counsel for the assessee at length. We have considered and gone through in detail, the order passed by the Assessing Officer, the order passed by the learned CIT(A) and impugned judgment and order passed by the learned Tribunal. 4.0. Now, so far as the deletion of amount made on account of Bad Debt Written off of Rs. 26,74,708/is concerned, from the material on record and the orders passed by the Assessing Officer, learned CIT(A) and learned Tribunal, it appears that there are concurrent finding of fact recorded by the learned CIT(A) as well as learned Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowing the claim of interest u/s.36(1)(iii) of the I.T. Act. The Assessing Officer has observed the figures of the balance sheet to say that the interest free funds available with the appellant were Rs. 5.29 Crores whereas the investment made which did not yield any interest were to the extent of Rs. 19.02 Crores. Hence, he held that the appellant had utilised interest bearing funds in making investment which did not yield any interest. 8.1 The above contention of the Assessing Officer is not right. Though the finding that the interest free funds available with the appellant were to the extent of Rs. 5.29 Crores is correct, however, the Assessing Officer could not have been disallowed any amount of interest in respect of loans and adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vailable of Rs. 5, 29, 93,800/hence, only to the extent of Rs. 3,30,0 1,822/( total investments of Rs. 8,59,95,622 () total interest free funds of Rs. 5, 29, 93, 800) of borrowed funds was utilized in making investment which did not yield any taxable income. From the dates on which this investment is made it is clear that interest bearing funds were utilised in making these investments to the extent of Rs. 3,30,01,822/from 27.02.2009 to 31.03.2009. Thus, the interest paid by the appellant on the money borrowed @ 12% per annum, hence the interest disallowable in this case, works out to Rs. 3,47,197 (Rs.3,30,01,822 x 32 + 365 x 12 100). The addition of Rs. 1,29,43,122/is hence reduced to Rs. 3,47,1 97/." 6.0. After considering the aforesaid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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