TaxTMI 
TaxTMI 
2023 (7) TMI 679
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....ng Officer (AO) u/s 143(3) of the Income Tax Act, 1961 (in short "Act") dated 23.03.2015 & 16.03.2016 for the Assessment Year (A.Y.) 2012-13 and 2013-14 respectively. Since the grounds raised in these appeals are identical, these appeals are clubbed, heard together and a common order is being passed for the sake of convenience as under. Facts are extracted from I.T.A.No.43/Viz/2023, A.Y.2012-13. 2. Brief facts of the case are that the assessee, a Private Limited Company, doing business in trading of raw jute in the name and style of "M/s Ratnam Jute Private Ltd." at Rajam, e-filed it's return of income on 28.09.2012, admitting taxable income of Rs. 11,37,350/-. The case was selected for scrutiny and notice u/s 143(2) dated 06.08.2013 was i....
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....and if the funds are realised, there is no necessity to the assessee to incur this expenditure. Accordingly, disallowed the interest expenditure of Rs. 27,66,685/-. 3. Aggrieved by the order of the AO, the assessee preferred an appeal before the CIT(A) and the Ld.CIT(A) dismissed the appeal of the assessee. 4. Aggrieved by the order of the Ld.CIT(A), the assessee preferred an appeal before the Tribunal by raising the following grounds : 1. The order of the learned Commissioner of Income Tax(Appeals) is contrary to the facts and also the law applicable to the facts of the case. 2. The learned Commissioner of Income Tax (Appeals) is not justified in sustaining the addition of Rs. 27,66,685/- made by the assessing officer towards disallo....
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....16 dated 30.11.2018 and pleaded to set aside the order passed by the Ld.CIT(A) and allow the appeal of the assessee. 7. Per contra, the Ld.DR relied on the order of the Ld.CIT(A) and pleaded to uphold the order of the Ld.CIT(A) and dismiss the appeal of the assessee. 8. I have heard both the parties, perused the orders of the lower authorities and the paper book filed by the assessee. In the instant case, it is apparent from the records that the assessee had invested an amount of Rs. 6,75,00,000/- during the F.Y.2007-08 and Rs. 75,00,000/- during the F.Y.2008-09, aggregating to Rs. 7,50,00,000/- in M/s KVR industries Ltd. a sister concern of the assessee company. It is evident from para No.2 of the assessment order that the assessee compa....
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....en by the CIT(A) that as regards the interest free advances given by the assessee even prior to the loan raised from the bank for acquiring vehicles and business properties,t he Revenue has failed to establish any nexus between the interest bearing funds and interest free advances made to his relatives and friends. Moreover, no cogent evidence is there on the file if secured loans have not been used by the assessee for business purposes. Assessee proved to have taken the secured loans for specific purpose and their utilization has not been disputed by the AO. AO has merely made the addition on the ground that the assessee has utilized sizable amount out of the secured loans to be given as interest free advances to his family memebrs, relate....