9911796707
TMI Blog2017 (6) TMI 454X X X X Extracts X X X X X X X X Extracts X X X X ..... essee earns share of profit which is exempt u/s.10(2A) of the I.T. Act, 1961. M/s. Siroya Holdings took a loan from M/s. HDFC Bank Limited of Rs. 21,80,00,000/- against discounting of rental income receivable from the lessee, M/s. Aditya Birla Retail Limited, to whom the building was let out by the firm. The said loan was disbursed to eight partners of M/s. Siroya Holdings who paid the interest on the said loan as well as paid the EMI to the said bank. Accordingly, the assessee had received loan amount of Rs. 2,77,88,755.71 from M/s. Siroya Holdings on 29th April, 2008. Utilising the said loan, the assessee gave a loan of Rs. 2,99,00,000/- to Mr. Shailesh Siroya on 2nd May, 2008 on interest. In the year ended 31st March, 2009 the assessee p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid interest free funds, the assessee had adjusted her investments in various assets aggregating to Rs. 2,23,81,564/- and the interest free loan to her husband, Mr. Shrenik D. Siroya, of Rs. 2,49,45,226/- which are aggregating to Rs. 4,73,26,790/-. Thus, the assessee had her own interest free fund of Rs. 1,51,65,341/- (i.e., Rs. 6,24,92,131/- minus Rs. 4,73,26,790/-) These facts are also accepted by the AO in the assessment order. As on 1st April, 2010, the outstanding loan given to Mr. Shailesh Siroya was Rs. 3,68,22,513/-, which was composed of interest bearing loan taken from HDFC Bank of Rs. 2,49,71,198/- (page 2) and the balance amount of Rs. 1,51,65,341/- is out of the own interest free funds of the assessee. These facts ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 2,66,23,895/-, i.e., @ 12.47%. 8. It is clear from the above that the assessee has not charged interest at a lesser rate to Mr. Shailesh Siroya as against the rate of interest charged by HDFC Bank on its loan. 9. Hon'ble Bombay High Court in the case of CIT vs. Reliance Utilities & Power Limited (313 ITR 340) wherein the High Court held that if there were funds available both interest-free and overdraft and/or loans taken, then a presumption would arise that investments would be out of the interest-free funds generated or available with the company, if the interest-free funds were sufficient to meet the investments. 10. In the instant case it is not in dispute that assessee was having her own interest free funds of Rs. 1,51,65,341/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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