Interest disallowance u/s. 36(1)(iii) unwarranted as sufficient own funds available for subsidiary investment

Thiruvalluvar Textiles Private Limited Vs ACIT (ITAT Chennai)

ITAT Chennai held that since there was sufficient own funds to make investment/advances to its subsidiary, the interest disallowance under section 36(1)(iii) was not warranted. Accordingly, AO directed to delete the addition.

Facts- The assessee is a company engaged in manufacture of cotton yarn and trading in textile products. The assessee case was selected for scrutiny assessment under CASS. During the assessment proceedings for the A.Y.2013-14, it is noticed that the assessee has invested towa

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