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TMI Blog2024 (2) TMI 880X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Ground No. 2 relates to the deletion of addition of Rs. 1,24,12,036/- on account of disallowance of claim of deduction u/s 35AC of the Income-tax Act, 1961 [the Act, for short]. 5. While scrutinizing the return of income, the Assessing Officer noticed that the assessee has claimed deduction u/s 35AC of the Act amounting to Rs. 1,24,12,036/-. The Assessing Officer observed that the assessee has not brought on record details/necessary evidences for being eligible to claim such deduction. Therefore, the assessee was show caused to justify its claim of deduction. 6. The assessee filed detailed reply explaining the claim. But the reply of the assessee was simply dismissed by the Assessing Officer who made addition of Rs. 1,24,12,036/-. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NIL Sahara India Rs. 17,86,78,438/- Rs. 9,15,34,8121- NIL The Assessing Officer observed that the assessee has not shown interest income on the aforementioned loans and advances. 14. A show cause notice was issued to the assessee asking it to explain as to why interest @ 12% may not be imputed on the average of opening and closing loans outstanding against the aforementioned related parties. 15. The assessee filed detailed reply which did not find any favour with the Assessing Officer who proceeded by imputing interest @ 12% and made addition of Rs. 1,43,63,802/-. 16. When the matter was agitated before the ld. CIT(A), it was explained that the transactions mentioned in the chart are self explanatory and are business transactions e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d "Non-current investment". Invoking the provisions of section 14A of the Act r.w.r. 8D of the ITAT Rules, the Assessing Officer computed disallowance at Rs. 6,13,17,433/-. 22. Before the ld. CIT(A), it was explained that the assessee was carrying on business of residuary non-banking company registered with RBI and in pursuance of RBI guidelines, 'Directed Investments" are required to be made which are "business investments'. Whatever income is accruing from these investments, the same is being offered under the head "Profits and gains of business or profession", meaning thereby, that there is no exempt income claimed by the assessee in its return of income. 23. Before us, the ld. DR vehemently supported the findings of the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of Rs. 2.73 crores as prior period expenses and rest Rs. 14.63 crores pertains to the relevant F.Y which has been shown by the assessee as income. 30. This plea was rejected by the Assessing Officer who proceeded to make the impugned addition. 31. Before the ld. CIT(A), the assessee reiterated its claim. 32. After verifying the facts from the ledger account and after being satisfied with the entries/narrations, the ld. CIT(A) deleted the impugned addition. 33. Before us, the ld. DR could not bring any factual error in the findings of the ld. CIT(A). 34. After verifying the facts, we are of the considered view that the Assessing Officer has not properly appreciated the facts in true perspective and on proper appreciation of facts, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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