Courts ruled that interest paid on loans to associated companies is deductible if commercially expedient and used for business purposes. Lower interest rates compared to borrowed funds do not warrant disallowance. Section 36(1)(iii) allows deductions irrespective of the capital asset acquired.
ITAT Delhi held that reopening of assessment under section 147 of the Income Tax Act, solely on the basis of information received, without application of mind is bad-in-law and liable to be quashed. Accordingly, appeal of revenue dismissed.
The Madras High Court held that an investment company’s interest disallowance under Section 36(1)(iii) was invalid as it followed a cash system of accounting. The Tribunal’s deletion of the addition was upheld, confirming that matching principles are not applicable under cash-based accounting.
The High Court set aside a tax demand that exceeded the amount stated in the show-cause notice, holding it violative of Section 75(7) of the GST Act. The matter was remanded for fresh adjudication.
The Court held that authorities failed to conduct basic enquiries before alleging reuse of transport documents. The seizure and appellate orders were quashed as unsustainable.
The Delhi High Court held that freezing of a company’s bank accounts without a proper investigation violated natural justice. Interim relief allowed the petitioner to operate accounts while maintaining a minimum balance.
ITAT Hyderabad held that ad hoc disallowance of commission expense cannot be sustained since assessee has substantiated commission payment with relevant evidence. Further, mere non-submission of certain bills and vouchers cannot be reason for ad hoc disallowance of land and development expenditure.
The Court found the appellate authority’s rejection of delay condonation mechanical and set aside the cancellation order, allowing revival upon fulfilling conditions.
The ITAT quashed the entire reassessment proceedings for AY 2015-16, observing that the foundational notice was issued after the permissible date. The ruling underscores that procedural timelines under TOLA cannot be extended retroactively. Subsequent orders based on the invalid notice were held without jurisdiction.
Tribunal ruled that confiscation cannot be sustained when goods were re-exported before Revenue’s appeal, restoring the original order.
