Home Highlights April 2014 Year 2014 This

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1. Addition made on account of diversion of fund - disallowance of interest expenses - there cannot be any disallowance of interest expenses provided the own fund of the...

2. Interest incurred claimed as a deduction u/s. 57(iii) out of interest earned from mutual funds - In our opinion, unless funds are borrowed for making deposit to earn...

3. Disallowance of excess interest paid - diversion of funds for non-business purposes - It is immaterial how the loan was treated by the Director - as far as the assessee...

4. Disallowance of claim of interest expenses u/s. 57(iii) - The Assessing Officer (AO) had disallowed a portion of the interest expenses based on the difference between...

5. Deduction u/s 57 while computing interest income - AO / CIT(A) had allowed deduction by restricting the of cost of funds to the extent of 15% on ad-hoc basis of the...

6. Addition of interest attributable on the diversion of loan fund - Once own fund of the assessee exceeds the amount of interest free loans and advances, then a...

7. Disallowance of interest u/s 36(1)(iii) towards interest expenditure - allegation that assessee company diverted its “interest bearing funds” for giving “interest free...

8. Addition towards interest on advances to partners - interest free advances given to partners - Disallowance of interest for diversion of funds - Additions confirmed.

9. Disallowance of proportionate interest u/s 36 (1) (iii) - when assessee had sufficient funds, why should it depend on borrowed funds. In any case, if at a given point of...

10. Correct head of income - interest on FD and gain of sale of mutual funds invested out of unutilized borrowed fund - interest/gains earned by the assessee company during...

11. Claim of interest expenditure - Nexus between investments and borrowed funds - A clear and direct nexus has to be established between the loan funds and the investments...

12. Disallowance of interest - diversion of funds for a non-business purpose - owned fund of the assessee as on 31st March 2013 and 31st March 2014 is more than the amount...

13. Income from other sources - Deduction of interest expenditure - direction of the CIT – A in restricting the deduction to the extent of income earned of term deposit -...

14. Interest earned from the unutilized capital subsidy and equity - Interest earned from the borrowed funds (short term temporary deposits) - interest from borrowed funds...

15. Disallowance of interest expenditure - diversion of funds for non-business purpose - In order to examine the allowability of interest expenditure on funds borrowed, when...