Interest Disallowance Clarified: Advance Not Presumed from Interest-Bearing Funds if Interest-Free Funds Exceed Advance. Additions Deleted.

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Full Text of the Document

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....Disallowance of interest on the advance - Simply because the assessee has secured loan from Standard Chartered Bank that does not mean that same interest bearing fund have been given for interest free loan to other party. If assessee has interest free funds which far exceed the advance given, then there cannot be any presumption that such advance has been given only out of such interest bearing funds. - Additions deleted - AT....