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TMI Blog2017 (5) TMI 1511X X X X Extracts X X X X X X X X Extracts X X X X ..... r of Ld. CIT (A), Jalandhar, dated 25.04.2014 for Asst. Year 2005-06. 2. The assessee has taken various grounds of appeal, however the crux of grounds of appeal is the action of Ld. CIT(A) by which he has confirmed disallowance of interest u/s 36(1)(iii) of the Act for making interest free advance to various persons. 3. The brief facts as noted in the assessment order are that the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsaction between these parties. If there is trading transaction between the parties, the advance to be treated as trade advance made on account of commercial expediency and such notional interest cannot be treated as income of the assessee. In view of the above, the issue is set aside to the file of the CIT(A) with the above direction. The CIT(A) is also directed to take net balance in each accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessing Officer had examined 14 parties which is against the directions of Hon'ble ITAT. Therefore, it was prayed that only10 parties involved in the original assessment order should have been considered. 6. The Ld. AR submitted that in respect of 4 parties, the balances were outstanding from the earlier year and therefore, the addition was not warranted, in view of the judgments in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 & 196/Asr/2015 (III) CIT Vs. Satish Bala Malhotra & Ors. (2016) 387 ITR 403 (P&H) (IV) CIT Vs. Max India Ltd (No.2) (2016) 388 ITR 81 (P&H)" 7. The Ld. DR, on the other hand heavily placed his reliance on the orders of authorities below. 8. We have heard the rival parties and have gone through the material placed on record. We find that it is a fact that in original assessment proceedings, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital of the assessee as has been held by Hon'ble Amritsar Bench in various case laws relied on by assessee. Therefore, the Assessing Officer is directed to restrict the disallowance of interest on loan amounts exceeding the available capital of the assessee. With these directions the appeal of the assessee is set aside to the office of Assessing Officer to reframe the assessment order in te ..... X X X X Extracts X X X X X X X X Extracts X X X X
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