Condonation of Delay: directoral disputes and pending company proceedings can constitute reasonable cause, allowing a belated return to be treated as ...
Revisionary jurisdiction under section 263 upheld; faceless assessments subject to revision when AO fails requisite enquiries, remitted for fresh asse...
Limited scope of processing under section 143(1): enhancement without show cause is unsustainable; remand for residency, taxation and TDS verification...
Interest on borrowed funds may not be disallowed where an assessee can demonstrate sufficient own interest-free funds for interest-free advances to related concerns. Where borrowed funds are diverted to associates, the allowability of interest must be examined by comparing interest paid on borrowings with interest charged on the advances, and the differential cost of diverted funds can be disallowed. Advances to directors and key managerial personnel require proof of commercial expediency; absent such evidence, proportionate interest attributable to those advances is liable to disallowance under section 36(1)(iii).
Interest on borrowed funds may not be disallowed where an assessee can demonstrate sufficient own interest-free funds for interest-free advances to related concerns. Where borrowed funds are diverted to associates, the allowability of interest must be examined by comparing interest paid on borrowings with interest charged on the advances, and the differential cost of diverted funds can be disallowed. Advances to directors and key managerial personnel require proof of commercial expediency; absent such evidence, proportionate interest attributable to those advances is liable to disallowance under section 36(1)(iii).
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