9911796707
TMI Blog2015 (1) TMI 1374X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome tax Act, 1961 for the assessment year 2009-10. 2. The assessee is a non-banking financial company (NBFC) and is engaged in the business of purchase and sale of shares and securities as well as loans and advances. In the course of assessment proceedings, the AO noted from the Notes on accounts that the assessee has not accounted the interest income accrued and receivable during the financial year 2008-09 due to merged entities. Accordingly an amount of Rs. 76,22,578/- was added back to the income of the assessee on account of accrued interest to the merged entity. The assessee did not challenge the action of the AO whereby the said amount of Rs. 76,22,578/- was added as accrued interest income. Subsequently, the AO initiated proceedin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nter-corporate deposits including interest waiver and thus the assessee neither recognized the interest on the loans granted by erstwhile companies nor recognized the expenditure in respect of interest payment on the loan taken by the erstwhile amalgamated companies due to pending negotiation and finalization of terms and conditions as well as restructuring of loans/ICDs. The ld. AR has forcefully contended that the claim of the assessee for not taking into account such interest is bonafide as the same did not accrue during the year pending, finalization of the terms and conditions with the other parties. He has further submitted that while making the addition the AO has completely ignored the fact that the assessee has taken a uniform deci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stwhile amalgamating companies in Note-13 of notes of account. Note 13 and 14 of notes of account are as under :- "13. In view of the continued negotiation by the erstwhile amalgamating companies with certain of their lenders for restructuring and/or reschedulement of loans/Inter corporate Deposits (ICDs) including interest waiver etc. interest if any, on such loans/ICDs is presently not determinable and hence the same has not been provided for in this account. 14. The terms and conditions and repayment in respect of some of the loans granted by the erstwhile amalgamating Companies are under renegotiation Pending finalization of the same, interest thereon have not been recognized in this account and such loans are considered good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see with respect to the interest expenditure on the loans taken by the erstwhile amalgamating companies, then the uniform decision of the assessee regarding the interest receivable in respect of loan granted by the erstwhile amalgamated companies being not recognized due to finalisation of terms and conditions is a bonafide claim of the assessee. Even otherwise the AO in para-3 of the assessment order passed under section 143(3) has reproduced the note No.13 which is in relation to the non-providing of the interest expenditure on the loans taken by the erstwhile amalgamating companies. Thus, the AO has made the addition in respect of interest income by reproducing a wrong note No.13 instead of relevant note being note No.14. When the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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