TaxTMI 
TaxTMI 
2015 (2) TMI 442
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....noticed that assessee has charged interest on bank loans under the head "Finance Charges" at Rs. 2,41,7,645. On enquiry, assessee submitted statement of details of interest on secured loans and payments made during the year up to the date of filing return. However, A.O. obtained information from Exim Bank directly and found that there are variations between what had been claimed by assessee and what has been stated by the bank. Assessee however, agreed for disallowance of interest under the provisions of section 43B, as there is variation between the amount stated to have been adjusted by the assessee to that of amount adjusted by the bank in their books. On these adjustment A.O. considered and levied penalty under section 271(1)(c) of the ....
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....terests charged by them. The details are : Ref. No. Principal Amount Interest Charged BC/04/T601/DO 2,11,85,816.53 34,42,695.25 BC/07/T601/AO 2,06,25,000.00 32,22,656.25 BC/09/T601/AO 4,59,99,990.00 57,49,998.90 BC/04/T601/CO 78,34,000.00 12,24,062.50 BC/04/T601/DO 78,34,000.00 12,24,062.50 BC/04/T601/EO 1,83,81,110.42 27,57,166.47 3.1. These letters received by the assessee were in fact not up to 31.03.2008 but for part period. Therefore, in the ledger accounts assessee has provided the interest as under : Date Particulars Vch.Type Vch.No. Debit Credit 20.03.08 Cr. Interest payable Exim Bank Being the interest payable to Exim Bank Loan 04/T601/DO Journal 290 34.42.695.00 Cr. Interest payable Exim ....
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....8. Assessee has treated most of the amount repaid towards interest in its books. Therefore, no amount was disallowed under section 43B. On enquiry by the A.O. the Bank however, reported that only an amount of Rs. 83,51,790 was adjusted towards interest, whereas the balance was adjusted towards principal outstanding. There was lot of correspondence between the A.O., assessee and the Bank and the Bank was giving various clarifications/revised statements. Therefore, it can be assumed that it is the Bank's internal accounting system which caused the discrepancy in the claims/ amounts. Assessee also placed on record the correspondence with the Bank which ultimately resulted in certifying the amounts. These subsequent enquiries made have a bearin....
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....e a false claim. We are unable to understand what is the false claim. As far as the claim of interest is concerned, there is no dispute with reference to assessee obtaining loans under various heads from Exim Bank and providing interest thereon, as per the interest rates which the A.O. also extracted in the assessment order. To that extent providing amount of Rs. 2,40,41,206.42 can not to be disputed. It is also not in dispute that assessee has paid the amounts during the year. The discrepancies arose because of adjustments of the amounts. As already stated, assessee adjusted towards the interest and did not disallow any amount under section 43B whereas, the said Bank adjusted the amount towards principal, restricting the adjustment to the ....