Dismissing the appeal of the revenue the Tribunal held that when the assessee had sufficient own interest-free funds to make investments, presumption would arise that advances made by assessee to its sister concern were out of interest-free funds .Accordingly no disallowances can be made.(AY. 2014-15)
ACIT v. Janak Global Resources (P.) Ltd. (2019) 175 ITD 365 (Chd.)(Trib.)
S. 36(1)(iii) : Interest on borrowed capital–Advance to sister concern- Sufficient own interest free funds-Presumption would arise that advances made by assessee to its sister concern were out of interest-free funds – No disallowances can be made.