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TMI Blog2001 (10) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... ent-assessee for the assessment years 1981-82, 1982-83 and 1983-84. The common questions referred by the Tribunal at the instance of the Revenue are the following: "1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in granting deduction of the amounts paid by way of interest referable to the amounts which the assessee had lent to various parties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee to the partners, their relatives and the sister concerns. The first appeals were not successful and therefore further appeals were filed by the assessee before the Tribunal. The Tribunal relying on the decision of this court in N. Sundareswaran v. CIT [1969] 72 ITR 219, allowed the appeals. The reference cases are at the instance of the Revenue. We have heard senior standing counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not applicable to the facts and circumstances of the case. On the other hand, counsel for the assessee contended that there is no finding that the borrowings or part of it were advanced to the partners, their relatives and the sister concerns of the assessee. According to him, there were cash balances available with the firm for such advances, and until it is established that the borrowed amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est free advance. The claim of the assessee's counsel that cash balances were available with the firm for advances to the partners, their relatives and the sister concerns does not advance the assessee's case. If cash balances are available, the borrowing itself is not for the purpose of the business. An assessee with liquidity cannot claim that it can give interest free advances to the partners a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... firm engaged in a related business as the assessee and in which he is also a partner along with his wife and minor children. Whatever benefit accrued to that firm will also be treated as income of the assessee assessable in his individual capacity. Therefore such an advance also should be taken as for business purposes of the assessee, and we do not see how that decision will apply to the facts o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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