Case Law Details
Allen Career Institute Vs The JCIT (ITAT Jaipur)
Where assessee is having mixed funds and interest free funds are larger than the amount of investments made during the year, can a presumption be drawn that the investments in the mutual fund units have been made out of interest- free funds and not out of interest bearing funds. In this regard, we find that the assessee is having opening bank balance in their FDR account at the beginning of the year amounting to Rs. 62.99 Cr. and closing balance of Rs. 98.03 Cr with fresh FDRs made during the year amounting to Rs. 58.03 Cr and FDRs matured during the year amounting to Rs. 22.99 Cr. The funds in the FDRs accounts clearly reflect the interest free funds which are available with the assessee which is far in excess of the amount of investments which has been made in the Mutual Funds units amounting to Rs. 3 Cr. Accordingly, on appreciation of the said facts and in absence of anything to the contrary, as per the settled legal proposition, a presumption can be drawn that the investments in the mutual fund units have been made out of interest- free funds and not out of interest bearing funds.
Full Text of the ITAT Order is as follows:-
This is an appeal filed by the assessee against the order of learned Commissioner (Appeals), Kota dated 26-11-2012 for assessment year 2009-10 wherein the assessee has taken the following grounds of appeal are as under :–
“1. The impugned additions and disallowance made in the order dated 29-12-2011 under section 143(3) of the Act, bad in law and on facts of the case, for want of jurisdiction and various other reasons and hence the same kindly be deleted.
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