In the ITAT Delhi case, the Appellate Tribunal ruled in favor of ...

Unexplained cash deposits u/s 68 were explained by withdrawals & cash balances. Interest disallowance u/s 36(1)(iii) deleted for real estate business.

Case Laws     Income Tax

May 31, 2024

In the ITAT Delhi case, the Appellate Tribunal ruled in favor of the assessee on two key issues. Firstly, regarding unexplained cash deposits u/s 68, the AO's failure to consider cash balances and debtor realizations led to the addition being deemed unsustainable. The Tribunal directed the AO to delete the addition. Secondly, on the disallowance of interest paid u/s 36(1)(iii), the Tribunal accepted the assessee's argument that interest on bank loans is a business expenditure, given the assessee's history of real estate and finance business activities. The disallowance made by the AO was deleted based on the Tribunal's decision for the assessment year 2009-10, affirming the assessee's real estate business activities.

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