Law Doesn’t Mandate establishment of Nexus Between Interest-Free Funds & Exempt Income Investments by assessee

ACIT Vs Punj Lloyd Ltd. (ITAT Delhi) No requirement of law that the assessee should establish nexus between interest free funds and investment which yields exempt income On perusal of Balance Sheet, AO found that the assessee company made investments in unquoted trade instruments in the shares of subsidiaries, joint ventures and SPVs. The investment included shares of domestic subsidiaries as well as overseas subsidiaries of the assessee company.   AO required the assessee to show cause why disallowance u/s 14A r.w. Rule 8D be not made.  Assessee replied   that the assessee has not earned ...