TaxTMI 
TaxTMI 
2022 (2) TMI 338
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....ax Act, 1961 (here-in-after referred to as "the Act") relevant to the Assessment Year 2005-2006. 2. The assessee has raised following grounds of appeal: 1. The C.I.T.(Appeals) erred in law and on facts in confirming the disallowance of Rs. 11,10,427/- u/s.36(1)(ii) of the I.T. Act, 1961 without appreciating the facts of the case properly. The appellant reserves its right to add, amend, alter or modify any of the grounds stated hereinabove either before or at the time of hearing. 3. The only issue raised by the assessee is that the Ld. CIT(A) erred in confirming the order of the AO by sustaining the disallowance of interest expenses of Rs. 11,10,427/- under the provision of section 36(1)(iii) of the Act. 4. Briefly stated facts are th....
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....see in 5 companies to have the controlling interest in these companies. Thus the investment was made for the strategic purpose and therefore there cannot be any disallowance of interest. 7.1 The Ld. AR further submitted that the companies in which the investment was made were amalgamated with the assessee by the Order of the Hon'ble Gujarat High Court which is placed at pages 36 to 54 of the paper book. 8. On the other hand the Ld. DR contended that at the time when assessee has acquired the shares, these companies were not the subsidiary companies to the assessee and there was no information on record that whether the investment was made by the assessee to acquire the controlling interest. The Ld. DR vehemently supported the order of the....
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....9;2. Respondent-assessee is a private limited company and is engaged in the business of financing. During the scrutiny assessment of the assessee's return for the assessment year 2008-09. Assessing Officer noticed that the assessee had claimed expenditure of interest paid on borrowed funds. The assessee had also funded its sister concern without charging interest. The Assessing Officer therefore disallowed the interest expenditure. The issue eventually reached the Tribunal. The Tribunal by the impugned judgment held in favour of the assessee. The Tribunal referred to and relied upon the decision of the Supreme Court in case of S.A. Builders Ltd. v.CIT 228 ITR 1 (SC) and concluded as under: - "If the aforesaid ratio laid down by Hon....