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TMI Blog2021 (1) TMI 1019X X X X Extracts X X X X X X X X Extracts X X X X ..... ties and the action of the A.O. to disallow proportionate interest considering such advances is not acceptable. Accordingly, we set aside the order of the CIT(A) and direct the Assessing officer to delete the addition and allow the grounds of appeal in favour of the assessee. - ITA No. 770/Mum/2019 - - - Dated:- 23-12-2020 - Pramod Kumar, Vice President And Pavan Kumar Gadale, Member (J) For the Appellant : Prasad Paranjape, AR For the Respondents : Rajeev Harit, CIT-DR ORDER Pavan Kumar Gadale, Member (J) The assessee has filed an appeal against the order of Commissioner of Income Tax (Appeals)-24, Mumbai, passed u/s. 143(3) and 250 of the Income Tax Act, 1961. The assessee has raised the following grounds of appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... engaged in the business as the authorized dealers and service of Hyundai Motor Cars. The return of income was filed on 28.11.2014 for the A.Y. 2014-15 disclosing a total income of Rs. (-) 2,30,36,884/-. Subsequently, the case was selected for scrutiny and notice u/s. 143(2) and 142(1) of the Act along with questionnaire were issued. In compliance, the Ld. AR for the assessee appeared from time to time and submitted the details and the case was discussed. On perusal of financial statements, the A.O. found that the assessee has made capital advances of ₹ 50,64,880/- as on 31.03.2014. Whereas, the assessee has obtained huge borrowed funds and interest on loan funds are debited to profit and loss account. The A.O. has observed that, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s but the balance with government authorities. The Ld. AR referred to the page 12 of the paper book and explained the assessee's long term capital borrowings. Further, the Ld. AR demonstrated that the capital advances considered by the A.O. are not advances made to sister concerns and referred to note 15 of the financial statements at page 22 of the paper book. We find, out of total amount of ₹ 50,64,880/- disclosed under short term loans and advances in the note to financial accounts, the amount of ₹ 47,11,874/- pertains to VAT, service tax, TDS and income tax refund receivables. Whereas the A.O. is of the opinion that these are the advances provided to sister concerns. We considering the submissions of the Ld. AR are of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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