In our considered view, without proving the nexus between the borrowed funds and its utilisation for non-business purposes, no dis allowance of interest expenditure can be made.
If during the course of assessment proceedings, the assessee filed details of claim of exemption of the same u/s.54F of the Act, the Assessing Officer is duty bound to entertain those details and verify the same and if the assessee is found eligible otherwise as per the conditions u/s.54F of the Act, he is bound to allow deduction to the assessee.
As for Hon’ble Kerala High Court’s decision in the case of Thomas George Muthoot (supra), undoubtedly, outside the jurisdiction of Hon’ble Kerala High Court and outside the jurisdiction of Hon’ble Delhi High Court- which has decided the issue in favour of the assessee, there are conflicting decisions on the issue of restrospectivity of second proviso to Section 40(a)(ia).
CSR expense disallowance is restricted to the expenses incurred by the assessee under a statutory obligation under section 135 of Companies Act 2013, and there is thus now a line of demarcation between the expenses incurred by the assessee on discharging corporate social responsibility under such a statutory obligation and under a voluntary assumption of responsibility.
ACIT Vs. S.P.Cold Storage (ITAT Raipur)- Mere mentioning of name in Search Warrant & Panchanama not sufficient for contemplating search against the assessee firm, Search at the residential premises of the Partners could not be deemed to be a search on the assessee firm
