Case Law Details
DCIT Vs Alok Industries Limited (ITAT Mumbai)
Issue raised is with respect to disallowance under Section 36(1)(iii) of the Act. The Revenue contends that assessee did not have adequate interest free funds, and that assessee could not establish commercial expediency.
The disallowance in this regard has been done on the same reasoning as in the case of disallowance under Section 14A of the Act. The Assessing Officer has disregarded the assessee’s submission that assessee has sufficient interest free funds to make these investments/advances on the ground that assessee has not submitted the cash flow statement. It is not denied that assessee had sufficient interest free funds. The learned CIT(A) has noted this aspect and he has decided this issue solely on the basis of the fact that assessee has sufficient interest free funds to give those advances and he has relied upon the decision of Hon’ble Bombay High Court in the case of HDFC Bank (supra). The learned CIT(A) has not allowed this issue in favour of assessee on the ground of commercial expediency. In this view of the matter, in our considered opinion, there is no infirmity in the order of learned CIT(A) in this regard. Accordingly, we uphold the same.
FULL TEXT OF THE ITAT JUDGEMENT
These are appeals by the Revenue directed against respective orders of CIT(A) for the respective assessment years. The issues are common and connected and the appeals were heard together. These are being consolidated and disposed of by this common order.
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