ITAT Chandigarh overturns interest disallowance, no link found between borrowing and advance without interest. The ITAT Chandigarh allowed the appeal by the assessee, overturning the Commissioner (Appeals) order to add Rs. 6,120 as interest disallowance for the ...
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ITAT Chandigarh overturns interest disallowance, no link found between borrowing and advance without interest.
The ITAT Chandigarh allowed the appeal by the assessee, overturning the Commissioner (Appeals) order to add Rs. 6,120 as interest disallowance for the assessment year 1976-77. The ITAT found no justification for the addition as there was no fresh borrowing by the assessee during the year, and the Revenue failed to establish a direct link between the borrowing and any advance without interest. Consequently, the addition was deleted, and the appeal was granted.
The appeal was made by the assessee against the Commissioner (Appeals) order regarding the addition of Rs. 6,120 as interest disallowance for the assessment year 1976-77. The ITAT Chandigarh found no justification for the addition as there was no fresh borrowing by the assessee during the year, and the Revenue failed to establish a direct link between the borrowing and any advance without interest. Therefore, the addition was deleted, and the appeal was allowed.
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