TaxTMI 
TaxTMI 
2023 (8) TMI 1503
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....d circumstances of the case and in law, the ld. CIT (A) erred in confirming the addition of Rs. 1,58,18,053/- made by the AO to the income of the Appellant by way of disallowing interest u/s. 36(1) (iii) being difference of interest paid and received by the Appellant on trade advances received and inter-corporate deposit given to unrelated parties. (b) The ld. CIT (A) failed to appreciate that the differential rate of interest paid was due to breach of contract for non-fulfilment of commitments and the same has no relation or comparison with interest received on inter-corporate deposit. (c) In reaching to the conclusion and confirming such addition the ld. CIT (A) omitted to consider relevant factors, considerations, principles and evid....
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....al entry on 22.11.2017, wherein M/s. Ravindra Energy Ltd. took over this liability for the pending amount as on that day, i.e., Rs. 37 Crores. Accordingly, company credited the account of M/s. Ravindra Energy Ltd. and correspondingly debited the account of M/s. Vantmuri Trading and Investments Ltd. Here it is pertinent to mention that assessee company is a subsidiary of M/s. Ravindra Energy Ltd. and M/s. Murkumbi Investments Pvt. Ltd. (To whom assessee provided un-secured loan @ 11.50%) is a shareholder of M/s. Ravindra Energy Ltd. 4. It is also observed that money taken as advance from M/s. Vantmuri Trading and Investments Ltd. for supply of goods in period 2011-12 or may be even before, finally settled with return of money (partially) an....
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....s business is a prerogative of concerned assessee. It may have loss and profit both. But, actions of the assessee must look genuine and transparent. No doubt authorities had no jurisdiction to determine a particular rate of interest, but the transactions of the assessee must not be colourable device to fulfil other purposes other than purposes of business enterprise under consideration. Assessee is totally failed to demonstrate the genuineness of its transaction along with the condition wholly and exclusively for the purposes of the Act. 7. In this connection we may refer to section 36(1) (iii) of the Income-tax Act, 1961 (here in after referred to as the 'Act') which states that "the amount of the interest paid in respect of capit....