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TMI Blog2018 (9) TMI 2016X X X X Extracts X X X X X X X X Extracts X X X X ..... he identical ground has already been decided for AY 2011-12in assessee s own case [ 2016 (12) TMI 1839 - ITAT MUMBAI] department declined to grant the benefit of deduction on interest paid primarily on the plea that the amount has not been actually paid and transfer of amount from one account to another account cannot be treated as paid. However, the Tribunal repelled the said plea by interpreting Section 43B of the Act and held that overdraft/cash credit accounts are not similar to loan accounts. The Tribunal further observed that the interest amount has been actually paid by the assessee through Overdraft/Cash Credit account and, therefore, set aside the disallowance made under Section 43B of the Act. A bare reading of Explanations 3C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mstances of the case and in law, the Ld. CIT(A) has erred in not appreciating the fact that the assessee did not have positive balance in his cash credit account on a single date prior to the filing of return. 3) Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding that the closing balance of ₹ 3.06 crores as on 31.03.2012 in the OD account being less than the OD limit of ₹ 6 crores, indicates that the same is on account of principle loan and not on account of interest. 4) Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in not appreciating the fact that the assessee has failed to furnish any documentary evidence in support o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case. 5. On the other hand, Ld. DR relied upon the orders passed by AO. 6. We have heard both the parties and we have also perused the material placed on record as well as the orders passed by revenue authorities. We find that the identical ground has already been decided by the Coordinate Bench of Hon ble ITAT in ITA No. 2230/Mum/15 for AY 2011-12in assessee s own case. The operative portion of the order of Hon ble ITAT contained in para no. 3 to 6, which is reproduced below:- 3. At the outset, ld. AR of the assessee argued that this case is squarely covered by the decision of Madras High Court in CIT vs. Prakash Foods Feed Mills P. Ltd. and T.C.(A). Nos. 775 and 808 of 2014 dated 26.11.2014 and the decision of Kolkata Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luded as under: 7. I have carefully considered the facts of the ea e, the findings of the AO, the submissions of the AR of the appellant and material placed on record. As per the bank statement, it is seen that during the year under consideration, the bank had provided the following amount of interest against CC Account with UBI: Date Interest debited Rs. 30.04.2010 94,573 31.05.2010 84,967 30.06.2010 95,701 31.07.2010 2,92,934 31.08.2010 2,22,761 30.09.2010 2,46,311 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce in OD Account was always remained a debit balance, is not correct as the OD limit of the CC Account was increased from ₹ 1.5 crores to ₹ 3 crore, which was not considered by the AO. Since the Closing balance i.e. (-) ₹ 2.80 crores, as on 31.03.2011, in the OD Account is less than the OD limit of ₹ 3 crores, indicate that the same is on account of principle loan and not on account of interest. Considering the facts of the case in entirety, above discussion and respectfully following the above decisions quoted, the addition made by the AO, on this account is hereby, deleted. This ground of appeal is allowed accordingly. 5. The Hon ble Madras High Court in CIT vs. Prakash Foods Feed Mills P. Ltd. (supra) whil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red that a deduction of any sum, being interest payable under clause (e) of this section, shall be allowed if such interest has been actually paid and any interest referred to in that clause which has been converted into a loan or advance shall not be deemed to have been actually paid. 5. The department declined to grant the benefit of deduction on interest paid primarily on the plea that the amount has not been actually paid and transfer of amount from one account to another account cannot be treated as paid. However, the Tribunal repelled the said plea by interpreting Section 43B of the Act and held that overdraft/cash credit accounts are not similar to loan accounts. The Tribunal further observed that the interest amount has been ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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