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2021 (10) TMI 676 - ITAT JAIPURDisallowance u/s 36(1)(iii) - interest payment by the assessee on notional basis - HELD THAT:- In this case, the assessee had made advances/loans by expecting to establish business connections with the above entities. There is no compulsion under the Income Tax Act that interest should always be charged on any lending, nor there is any requirement that income must be earned by utilizing the capital borrowed with interest so as to be entitled to the deduction u/s 36(1)(iii) - keeping in view the relations of the assessee with the above entities, we found that all the above three entities were having direct nexus with the business activities/operations and all these entities also help in the business of the assessee either directly or indirectly by way of procuring/securing orders or selling goods, exploring new markets etc., therefore, we are of the considered view that the ld. CIT(A) has rightly concluded that the amount so advanced by the assessee to these entities were for commercial and business expediency. CIT(A) has passed a speaking and reasoned order discussing all the facts and circumstances as well as legal propositions of law therefore, considering the totality of facts and circumstances and case laws, we find no reason to interfere in the order of the ld. CIT(A) qua this issue, hence, we uphold the same - Appeal of the Revenue is dismissed.
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