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TMI Blog2017 (4) TMI 1330X X X X Extracts X X X X X X X X Extracts X X X X ..... terest bearing investments to the tune of ₹ 72,28,15,197/-. It was concluded that the assessee had not deployed interest bearing funds into non interest bearing investments. Assessee is a major share holder and therefore the advance/investments made by assessee in these companies cannot be said to be without commercial expediency. There would be a direct benefit to the assessee if the interest free investments made in these companies results into more profits to these companies and indirectly to the assessee. - Decided against revenue - ITA No. 163 of 2017 (O&M) - - - Dated:- 17-4-2017 - Ajay Kumar Mittal And Ramendra Jain, JJ. Mr Rajesh Katoch,Senior Standing Counsel for the appellant-revenue ORDER Ajay Kumar Mit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t that the assessee has not maintained any separate account for interest bearing/interest free funds. Therefore, the advance made to sister concerns cannot be said to be made out of interest free funds? 2. A few facts relevant for the decision of the controversy involved as narrated in the appeal may be noticed. During the course of assessment proceedings, it was noticed by the Assessing Officer that the assessee had an amount of ₹ 72,28,15,197/- standing as investments in various related concerns but had not received any interest or return on account of such investments. The assessee submitted that the interest free advances to the related parties were made in view of the larger interest of the group. The Assessing Officer obser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer was confirmed by the CIT(A). Not satisfied with the order, the assessee filed an appeal before the Tribunal. Vide order dated 12.8.2016, Annexure A.III, the Tribunal allowed the appeal filed by the assessee, deleting the addition on account of disallowance of interest expenditure. Hence, the instant appeal by the appellant-revenue. 3. We have heard learned counsel for the appellant-revenue. 4. After examining the matter, it has been categorically recorded by the Tribunal that in the case of the assessee, non-interest bearing funds are more than non interest bearing investments. Further, the assessee had declared more interest income on fixed deposits than the interest paid by him on interest bearing funds. The total non i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor of M/s Modern Publishers and is also a majority shareholders in the companies in which interest free investments have been made. Paper Book page 12 is the list of companies in which the assessee is holding a major chunk of shares. The rest of the shares are also held by other family members of the assessee. For the sake of convenience the chart showing shareholding of assessee in the companies has been made part of this order. xxxxxxxxxxxxxxxxxxxxx Therefore, from the above chart, it can be safely concluded that assessee is a major share holder and therefore the advance/investments made by assessee in these companies cannot be said to be without commercial expediency. There would be a direct benefit to the assessee if the in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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