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TMI Blog2022 (3) TMI 827X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee has borrowed the money from his firm for the purposes of his profession. The assessee in his wisdom borrowed money at a higher rate of interest and lended the same at a lower rate of interest. AO should have disallowed the entire interest claimed by the assessee but we cannot improve the assessment order nor I can improve the order of the CIT(A). In my considered opinion borrowing money at a higher rate of interest from a related party and lending the same at lower rate of interest to an unrelated party defies all commercial prudence expected from a Chartered Accountant. Surrounding circumstances cannot be ignored. Appeal filed by the assessee is dismissed. - ITA No.934/Del/2020 (Assessment Year: 2014-15) - - - Dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epted by the AO to concluded the assessment proceedings by making addition of ₹ 1429758/-. 5. Assessee agitated the matter before the CIT(A) and strongly contended that the entire amount of ₹ 4.50 crores borrowed from M/s. Y. K. Gupta Company was given as loan to M/s. Smartest Corporate Services Pvt. Ltd. the entire interest paid on ₹ 4.50 crores should be allowed as expenses u/s. 57 (iii) because the said expenditure was incurred wholly and exclusively for the purpose of earning interest income from M/s. Smartest Corporate Services Pvt. Ltd. 6. After considering the facts and the submissions the CIT(A) held as under :- 4.3 The contentions of the AR have been considered and the order of the AO has also bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sunworld Resi. Pvt. Ltd 83,193/- Sunworld Infrastructure Pvt. Ltd. 83,193/- Smartest Corporate Ser. Pvt. Ltd. (Personal Funds) 1,50,406/- Smartest Corporate Ser. Pvt. Ltd. (Borrowed Funds) 39,76,274/- 39,76,274/- NIL Less: Interest Paid to M/s Y.K. Gupta Co. (₹ 54,06,032/- restricted to ₹ 39,76,274/-) Total 29,24,989/- Therefore, considering the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X
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