No exemption U/s. 11 on acquisition of assets from borrowed funds

In the present case, the sole basis of disallowing the amount of Rs. 10,62,94,245/- is on account of the loans borrowed for the purpose of capital expenditure. It is thus clear that the total expenditure incurred by the assessee was Rs. 47,87,64,431/-, for the charitable purposes / activities of the trust. It is also coming from the record that the assessee has applied the total amount of Rs. 47,87,64,431/- for the trust purposes. The reasoning given by the AO is this that as the excess fund was already available with the assessee-

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