9911796707
TMI Blog2015 (4) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... Respondent : A. N. Mahajan, S.C., B. J. Agarwal ORDER (Per Hon'ble Dr. Satish Chandra, J) The present appeal is filed by the assessee against the impugned order dated 16th September 2005 passed by the Income Tax Appellate Tribunal, Delhi in ITA No. 36942/Del/2004 for the assessment year 1998-1999. The Tribunal has also dismissed the Misc. Application No. 265(Del.)06 vide its order dated 22 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee, so the A.O. disallowed the said amount and made the addition. But the CIT(A) has deleted the said addition by observing that the funds were borrowed for the purpose of business and to settle the debts, money was paid to the creditors. However, the Tribunal has restored the order passed by A.O. and sustained the addition made by the A.O. for Rs. 1,22,134/-. Shri Suyash Agrawal, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... virtue of the settlement, the assessee has to pay interest amount for only one year and for remaining period no interest was payable. In other words, the assessee has paid the interest only for the assessment year 1998-99 and not for the remaining four years as per the settlement. By considering the totality of the facts and circumstances of the case, it appears that originally borrowed funds we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... averments were expressed in the case of CIT vs. United Carbon India Limited (1989) 178 ITR 444 (Bom.). Interest on borrowing is payable as per ratio laid down in the case of CIT vs. South India Steels 1977 109 ITR 341 (Mad.). It makes no difference that business was closed during the period when the interest was paid as the liability was continued. In the instant case, the borrowed funds were ut ..... X X X X Extracts X X X X X X X X Extracts X X X X
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