2019 (1) TMI 2087

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....cating with brief fact as under:- Disallowance of Rs. 2490198/- u/s. 40A of the act. 3. During the course of assessment, the assessing officer noticed that assessee has made substantial investment in equity share and incurred interest expenditure of Rs. 6,51,68,943/- as against last year interest expenses of Rs. 5,07,54,161/-. On the basis of this information the assessee was asked to explain why not disallowance of interest expenses under the provision of section 14A read with rule 8D was made. The assessee explained that it had not earned any exempt income during the year under consideration, therefore, there was no question of any disallowance u/s. 14A of the act r.w. rule 8D of the I.T. Rule. However, the assessing ....

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....ices to the Posco Pune India Processing Centre Pvt. Ltd towards delayed payment for raw material purchased from them and such type of interest @ 6% were being paid since last 5 years on which due TDS u/s. 194A was duly deducted. However the assessing officer had not accepted the explanation of the assessee and he was of the view that M/s. Posco Pune Processing Pvt. Ltd. was an associated concern of the assessee covered by section 40A(2)(b) of the act and the assessee had failed to substantiate its claim with any documentary evidences, therefore, the claim of the assessee on interest payment was also disallowed u/s. 40A(2)(b) of the act and added to the total income of the assessee. Deleting addition of Rs. 9,27,080/- made on account....

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....nsideration, therefore, following the decision of the Hon'ble Jurisdictional High Court in the case of CIT s. Corrtch Energy Pvt. Ltd. TA No. 234 of 2014, we do not find any infirmity in the decision of the ld. CIT(A). Therefore, this ground of appeal of the Revenue stands dismissed. In respect of Rs. 22,87,852/- of insurance expenses, the assessing officer disallowed the impugned expenses by treating the said expenses incurred on the personal life insurance of the directors. After considering the facts as reported supra we observe that it is undisputed fact that the aforesaid expenditure were incurred towards Keyman Insurance polies to be allowable as business expenses. Therefore, we do not find any infirmity in the decision o....