TaxTMI 
TaxTMI 
2014 (7) TMI 1062
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....t u/s.14A of Rs. 13,11,030/-" 2. An assessment was framed u/s.143(3), vide order dated 29.03.2010 according to which the assessee company is in the business of manufacturing of denim and also trading of fabrics. It was noted by the AO that substantial investment amounting to Rs. 6,23,03,240/- in shares and securities was made. In view of the provisions of Section 10(34), the said income on the investment was exempted. Next observation of the AO was that there were interest bearing secured loans of Rs. 222.34 crores and unsecured loans of Rs. 48.20 crores. It was also found that the assessee had paid interest of Rs. 14,80,92,140/-. The AO has, therefore, invoked the provisions of Section 14A and a proportionate disallowance of interest was ....
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....ind that CIT(A) while deleting the addition has noted that the Assessee was having sufficient interest free funds and therefore there was no justification for presuming that any part of interest bearing loan has been utilized for the purpose of making investments. He has further noted that the capital and reserves of the Assessee was to the extent of Rs. 66 crores as against the investment of Rs. 6 crores which also shows that there cannot be any presumption of use of borrowed funds for such investments. The Assessee has submitted that major investments made in earlier years were out of interest free unsecured loans. This submission of Assessee has not been controverted by Revenue by bringing any contrary material on record. Before us, the ....
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.... 8. Now before us, an order of ITAT 'C' Bench dated 29.11.2013 (supra) has been filed wherein vide paragraph 13 the issue was decided in assessee's favour, relevant portion reproduced below: "We have heard the rival submissions and perused the material on record. We find that A.O. has only disallowed the claim of depreciation for the reason that the vehicle was in the name of the Director and not in the name of the Assessee. Before us, the Revenue has not brought any material on record to demonstrate that the purchase of vehicle was not out of the funds of the Assessee and further the vehicle was not used for the purpose of business of the Assessee. The submission of the A.R. that no depreciation has been claimed by the Directors with res....