2013 (12) TMI 1416

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.... Petitioner : R. R. Agarwal For the Respondent : A.N. Mahajan,Ashok Kumar,Bharatji Agarwal,Csc,D. Awasthi,G.Krishna,R.K. Upadhaya,S Chopra ORDER We have heard Shri Suyash Agrawal, learned counsel for the assessee-appellant. Shri R.K. Upadhyay appears for the Income Tax Department. These appeals were admitted on the question of law:- "Whether the Tribunal was legally justified in con....

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.... to the bank. The A.O. also found that so far as family members are concerned, the assessee had shown interest at 24% on the borrowed capital and whereas the interest on loans from third party was paid at 18%. He paid interest to banks at 20.50%. The Commissioner (Appeals) dismissed the appeal. The Income Tax Appellate Tribunal dismissed the second appeal confirming the findings that the rate o....

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....e findings that there was no diversion of borrowed capital for non-commercial purposes it was held that no part of interest could be disallowed under Section 36 (1) (iii). The Court relied upon CIT v. Radico Khaitan Ltd., (2005) 274 ITR 354 (All), and S.A. Builders Ltd. v. CIT (Appeals), (2007) 288 ITR 1 (SC). In CIT v. Rockman Cycle Industries Private Ltd., (Supra) the assessee had borrowed fr....

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....om its own view point but that of a prudent businessman. Each case will depend upon its own facts. In the present case the Tribunal has confirming the finding of CIT (A) and AO, held that whereas the appellant borrowed from the outsiders at 18%, the capital borrowed from family members and sister concern was at 24%. Even bank rate was not more than 21%. The A.O. tried to enter into the true nat....