Case Law Details
DCIT Vs Asian Infra Projects Private Limited (ITAT Mumbai)
It is quite evident that the business of the assessee was already set-up since the assessee had already reflected income from real estate business during AY 2008-09. The perusal of assessee’s financial statements for year under consideration would show that the assessee has obtained unsecured loans of Rs.583.56 Lacs which has substantially been advanced to directors & others (to the extent of Rs.185.45 Lacs) and to make-up for the accumulated losses of Rs.317.31 Lacs incurred by the assessee over the years. The assessee do not have any other source of fund except Share capital of Rs.1 Lac. Therefore, there was complete nexus between the borrowings and lending made by the assessee. This being the case, the interest expenditure having direct nexus with interest income was clearly allowable to the assessee.
FULL TEXT OF THE ITAT JUDGEMENT
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