2021 (4) TMI 854

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.... extent he confirmed the addition made by the Assessing officer's order issued u/s. 143(3) of the Income Tax Act. 2.) The learned Commissioner of Income Tax (Appeal), was not justified in confirming the disallowance of Interest to the extent of Rs. 20,28,015/- on account of interest on term loan, rejecting the submissions and facts of the case, Thus the Commissioner's order is totally violative of natural justice. 3.) The learned CIT (Appeals) should have observed that the assessing officer did not follow the principle of natural justice as he did not grant reasonable time for furnishing evidence, ignoring the facts on records. 4.) The learned CIT (Appeals) as well as the learned assessing officer was not ....

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....cation of interest debited to Profit & Loss A/c. where only stock was resold during the year: Our client was passing through financial crisis. As huge stock is lying in godown and he was thinking of winding up the business by selling the existing stock. However, administrative expenses debited to Profit & Loss A/c. are incurred at 50% compare to last year in regular course of business except interest on loan."? 4. Upon assessee's appeal learned CIT(A) confirmed the Assessing Officer's action. He held as under:- "I have carefully gone through the Assessment Order and the submissions made on behalf of the appellant. In this case, the appellant had claimed Rs. 20,28,01.5/- on account of interest on term loan. The A.O. disal....

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.... was not justified. In view of the above discussion, the A.O. disallowed interest of Rs. 20,28,015/- claimed as deduction u/s. 37(1) of the I.T. Act. Reliance in this connection is placed on the decision of the CIT vs. H.R. Sugar Factory Pvt. Ltd. [187 ITR 363 (All.)]. In this connection, it was held that "had the money not advanced to the directors it would have been available to the assessee for its business purposes and to that extent it may not have been necessary to borrow from the banks". In this case also, had the money not been advanced interest free to associate concern M/s. Mohan Impex to that extent, it may not had been necessary to borrow from the banks. Similarly, if the debtors were also charged interest perhaps there was no n....