TaxTMI 
TaxTMI 
2019 (4) TMI 1990
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....The sole ground taken by the assessee in this appeal is regarding the action of the Ld. CIT(A) in upholding the disallowance of a sum of Rs. 29,10,663/- out of interest account made by the Assessing officer u/s 36(1)(iii) of the Income-tax Act, 1961 (in short 'the Act'). 4. The brief facts relating to the issue are that during the course of assessment proceedings, the Assessing officer found that the assessee had shown capital work in progress to the extent of Rs. 31,50,70,871/-. He observed that the assessee had made the payment of capital advance and investment for construction of building out of borrowed funds which was required to be capitalized up to the end of the financial year. The assessee submitted that the interest on te....
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....o consider the proposition of law laid down by the Hon'ble Supreme Court in the case of 'CIT (LTU) Vs. Reliance Industries Ltd.' [2010] 410 ITR 466 (SC), wherein, the Hon'ble Supreme Court has again confirmed the proposition of law that if the own funds / interest free funds are available with the assessee to meet the investment, presumption will be that the assessee had used its own / interest free funds for the said investment. 7. The Ld. DR, on the other hand, has relied upon the findings of the lower authorities. 8. Considering the above submissions of the assessee, in our view, the matter is required to be restored to the file of the Assessing officer to duly consider the aforesaid contention of the assessee, examine the deta....
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.... capital advance of Rs. 84,60,720/- out of borrowed funds which were relatable to work in progress. Since the assets were not put to use, the Assessing officer calculated the disallowance of interest by invoking the provisions of section 36(1)(iii) of the Act and worked out the notional interest expenditure of Rs. 4,86,491/- and added back the same to the total income of the assessee. 12. Being aggrieved by the above order of the Assessing officer, the assessee preferred appeal before the Ld. CIT(A). It was submitted before the Ld. CIT(A) that the own / interest free funds of the assessee were sufficient to meet the investment / interest free advances / capital work in progress, made by the assessee, however, the Ld. CIT(A) held that ....
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....this ground, the assessee has agitated the action of the CIT(A) in confirming the disallowance of Rs. 3,39,385/- as against the disallowance of Rs. 3,77,055/- made by the Assessing officer. The Assessing officer made the disallowance of Rs. 3,77,055/- out of the Diwali Expenses, Gardening expenses, Printing & Stationery and website promotion expenses on the ground that the same were not properly vouched. 17. Before the Ld. CIT(A), the assessee submitted that most of the expenses incurred by the assessee were by way of account payee cheques / bills. As in case of Diwali expenses, out of total expenses of Rs. 4,27,541/-, a single bill amount of Rs. 3,75,000/- was paid through cheque. Likewise, the expenses on website promotion, most of the d....