TMI Blog2020 (1) TMI 961X X X X Extracts X X X X X X X X Extracts X X X X ..... nal in the case of ACIT Vs. Auto Light (India) Ltd. (supra), has observed that assessee was required to prove whether on the date of making investment or giving the interest free amount to the sister concern, the assessee was having sufficient interest free funds available with it. For that purpose, the assessee should demonstrate from its cash flow statement and bank account that it has date-wise availability of interest free funds on the date of making advances to the sister concern. What is provided u/s 36 of the Act the deduction on the amount of interest paid on the capital borrowed for the purpose of business or profession, the provision is made applicable on the capital borrowed and has not restricted to the capital borrowed durin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ORDER PER KUL BHARAT, J.M: This appeal by the assessee is directed against order of the CIT(A)-2, Bhopal dated 28.3.2019 pertaining to the assessment year 2013-14. The assessee has raised following grounds of appeal: 1. There is no jurisdiction either in law or on facts for the Ld. CIT(A) to sustain the disallowance of ₹ 45,11,593/- under section 36(1)(iii) out of interest payment on the ground that borrowed funds has not been utilised for business purpose. 2. That the Ld. CIT(A) was not justified in completely discarding the specific submission regarding the fact that advances to SKIPL were not given in the A.Y. 2013-14 and thus the order of L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e facts giving rise to the present appeal are that the case of the assessee was picked up for scrutiny assessment and the assessment u/s 143(3) of the Income Tax Act, 1961 (hereinafter called as the Act ) was framed vide order dated 29.3.2016. The A.O. during the course of assessment proceedings noticed that on perusal of audited accounts for the year under appeal and material available on record, the assessee company claimed a sum of ₹ 6,91,59,001/- as other advances from M/s. S.K. Infrastructure Pvt. Ltd. in the schedule 12 of the Loans and advances forming part of the audited accounts. The A.O. therefore, called upon the assessee to explain vide questionnaire u/s 142(1) of the Act dated 25.2.2016. In response thereto, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontention of the assessee is that the amount was not given in the year under consideration. Therefore, the question of genuineness, creditworthiness and business expediency is to be verified in the year when this advance was given. It is also contended that if genuineness, creditworthiness and business expediency is not proved in that year, in that event, the A.O. would be at liberty to make addition in this year. To buttress this contention, reliance is made on the decision of the coordinate bench rendered in the case of ACIT Vs. Auto Light (India) Ltd. (2016) 180 TTJ 228 (Jaipur). We find force in this contention of the assessee. Under the identical facts, the coordinate bench of this Tribunal in the case of ACIT Vs. Auto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given out of any business expediency. In case the A.O. finds that there was no business expediency or availability of interest free funds when the advances were given, he would be free to sustain the impugned addition. 6. Ground No.1 of the assessee s appeal is allowed for statistical purposes. 7. Ground No.2 is against sustaining the addition of ₹ 1,38,437/- in respect of the difference between interest income shown by appellant as per form 26AS and without properly appreciating the submissions filed before the Ld. CIT(A). It is contended that the interest received on fixed deposit was ₹ 9,10,138/- only, whereas during the earlier previous year it was ₹ 90,33,638/-. Basically, the differe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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