Notional Interest Cannot Be Added on Interest-Free Business Funds When Real Income Is Known.

The Income Tax Appellate Tribunal (ITAT) ruled that no notional interest should be added to interest-free advances when the assessee has sufficient interest-free funds for business purposes. The decision emphasized that only real income, not presumptive income without evidence, can be assessed. The tribunal found no basis for establishing interest income from short-term loans and advances based on debtors' replies or the assessee's accounts, leading to a decision in favor of the assessee by disallowing the addition of notional interest. .....

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