2019 (1) TMI 392

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....d both the parties. Case file perused. 2. The assessee's sole substantive ground seeks to challenge correctness of both the lower authorities' action disallowing its interest claim of Rs.12,16,614/- u/s 36(1)(iii) of the Act. The CIT(A)'s detailed discussion qua the instant issue reads as under:- "6. I have gone through the contention of the assessee, the order passed by the AO and the submissions made by the Appellant. The decision of this appeal is given as under:- In this case the AO disallowed interest of Rs. 12,16,6144/- on the ground that unsecured loan amounting to Rs. 1,33,67,163/- was not used for business purpose. The appellant deployed the same in various investment which are as under:- 'Interest of Rs. 12,16,614/-....

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....ness expenditure. In this regard the balance sheet of the appellant was perused. The perusal of the balance sheet of the appellant shows that the appellant has shown cash in bank to the tune of Rs. 2,02,10,038/- in the Royal Bank of Scotland and investment as per schedule-I has been shown to the extent of Rs. 1,88,90,0654/-. The appellant did not submit any cash flow statement which can through any light that the investment were made out of his surplus fund. It cannot be investment from his surplus fund too because capital in the balance sheet is shown to the tune of Rs. 1,35,17,700/- only, whereas in the case of asset side closing stock was to the tune of Rs. 2.6crore and sundry creditor was shown to the tune of Rs. 2.4 crore and ....