If assessee have sufficient own funds, Interest on borrowed capital cannot be disallowed for Interest free loans to various parties

ACIT Vs Banwarilall Pasari (ITAT Kolkata) A perusal of the letter dated 28.01.2015 filed by the assessee during the course of assessment proceedings before the A.O. clearly shows that it was specifically pointed out by the assessee that the loans in question were given to the various parties out of internal accruals. Moreover, a perusal of the balance sheet of the assessee firm as at 31.03.2012 filed along with the return of income makes it abundantly clear that sufficient own funds in the form of partners capital were available with the assessee firm at the relevant time to give the loans in ...