2021 (3) TMI 1101

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....xed for hearing on 15.12.2020 & 16.02.2021, neither the assessee nor its authorized representative appeared before the Bench on the above dates. As there is non-compliance by the assessee, we are proceeding to dispose off this appeal after examining the materials available on record and after hearing the Ld. Departmental Representative (DR). 2. The grounds of appeal filed by the assessee read as under: 1(a) The Ld. CIT(A) erred in confirming the disallowance of interest expenses of Rs. 3,52,251/- u/s. 36(1)(iii) of the I.T. Act stating that the interest bearing funds were utilized for non-business purposes, i.e. investment in mutual funds. (b) The Ld. CIT(A) erred in confirming the disallowance of interest u/s. 36(1)(ii....

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....edless to mention that Section 36(1)(iii) of the Income Tax Act provides for deduction of interest of loan raised for business purposes. Once the appellant claimed any such deduction in the books of account, the onus will be on the appellant to satisfy the Assessing Officer that whatever loans were raised by the appellant were used for business purposes. If in the process of examination of genuineness of such a deduction, it transpires that the appellant had utilized certain funds for investment for short period or for any other than business purpose, there would be a very heavy onus on the appellant to discharge before the Assessing Officer to the effect that in spite of pending term loans and working capital loans on which the appellant i....