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TMI Blog2023 (7) TMI 678X X X X Extracts X X X X X X X X Extracts X X X X ..... centage of 6% as against 12% applied by the AO in respect of disallowance of interest - HELD THAT:- As the interest free funds available with the assessee are far more in excess of the loan/ advance given to the subsidiary. Hon ble Supreme Court in the case of Reliance Industries [ 2019 (1) TMI 757 - SUPREME COURT] has held that no disallowance of interest expense is warranted when interest free funds available are far more in excess of the interest free advance. No merit in the additions made by the AO, therefore, the AO is directed to delete the additions. Decided in favour of assessee. - ITA No. 1140/Del/2018 And ITA No. 1320/Del/2018 - - - Dated:- 14-7-2023 - Sh. N. K. Billaiya, Accountant Member And Sh. Anubhav Sharma, Judicial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he CIT(A) and once again contended that it has earned no exempt income. 7. After considering the facts and the submissions and after drawing support from decision of Hon ble Delhi High Court in the case of Cheminvest Ltd. 378 ITR 33 the CIT(A) deleted the impugned addition. 8. Before us the DR strongly supported the findings of the AO. 9. Per contra the Counsel for the assessee reiterated what has been stated before the lower authorities. 10. The assessee has not earned any exempt income during the year under consideration is not disputed, therefore, the ratio laiddown by the Hon ble Jurisdictional High Court of Delhi in the case of Era Infrastructure (India) Ltd. 448 ITR 674 squarely apply wherein the Hon ble High Court has hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om which it has given interest free advances and since the assessee was having mixed pool of funds the presumption is that the loan / advance has been given out of interest free funds. 16. The DR strongly supported the findings of the AO. 17. We have given a thoughtful consideration to the orders of the authorities below. Summary of own funds, interest free loan taken and advance given to Noble starting from the year in which the advance was given can be understood from the following chart :- 18. From the above chart it is crystal clear that the interest free funds available with the assessee are far more in excess of the loan/ advance given to the subsidiary. 19. Hon ble Supreme Court in the case of Reliance Industries 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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