Addition untenable as interest-bearing funds not used for advancing interest-free funds

DCIT Vs SKM Fabrics (Amana) Ltd. (ITAT Mumbai) Additions under section 36(1)(iii) of the Act, without bringing anything on record to suggest that interest-bearing funds were actually utilised for the purpose of advancing funds on which no interest was charged by the assessee, is unsustainable in law. Facts- The assessee filed its ROI declaring total loss at Rs. 10,92,25,828. During the course of assessment proceedings, it was observed that the assessee has shown loans and advances and claimed interest expense of Rs. 10,65,00,980/-. Notice was issued to the assessee asking as to why interest ex...