No Addition of Interest for Interest-Free Loan out of Interest-Free Funds

Sidiqbhai Usmanbhai Kaliwala Vs DCIT (ITAT Ahmedabad)

It is seen from record, the assessee paid interest free loan of Rs. 21,67,952/- to M/s. S.S. Enterprise, out of the interest free funds available with the assessee, who has made a profit of Rs. 31,04,682/- during the assessment year 2015-16. It is not the case of the assessee that “borrowed funds” were given interest free loans and advances to the sister concern. Therefore the ratio of the Hon’ble Apex Court judgment in the case of S.A. Builders is not applicable to

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