This Digest of case laws is prepared by KSA Legal and AIFTP from judgements reported in BCAJ, CTR, DTR, ITD, ITR, ITR (Trib), Chamber's Journal, SOT, Taxman, TTJ, BCAJ, ACAJ, www.itatonline.org and other journals
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S. 36(1)(iii) :Interest on borrowed capital-Sufficient funds-Investment in shares-Disallowance is not justified-Matter remanded.

ACIT v. Nahar Industrial Enterprises Ltd. (2022) 219 DTR 73 / 219 TTJ 544 / 99 ITR 562 (Chd)(Trib) ACIT v. Nahar Spinning Mills Ltd (2022) 219 DTR 73 / 219 TTJ 544 / 99 ITR 562 / 142 taxmann.com 52 (Chd)(Trib) ACIT v. Oswal Woollen Mills Ltd. (2022) 219 DTR 73/ 219 TTJ 544 / 99 ITR 562 / 142 taxmann.com 52 (Chd)(Trib)

S. 36(1)(iii) : Interest on borrowed capital-Amount advanced to sister concern-Interest recovered-Disallowance of interest is not justified.

Milrco Good Earth Property & Development LLP v. ACIT (2022) 217 TTJ 52 (UO) / 142 taxmann.com 149 (Panaji) (Trib)

S. 36(1)(iii) : Interest on borrowed capital-Interest-free funds far in excess of loan advanced-Disallowance of interest not warranted.

Wanbury Ltd. v. Dy. CIT (2022) 95 ITR 87 (SN)(Mum) (Trib)

S. 36(1)(iii): Interest on borrowed capital-Advancing borrowed money to sister concern for business purposes without charging interest-Interest expenses allowable as deduction. [S. 37(1)]

Dy. CIT v. Shriram Investments (2022)95 ITR 111 (Chennai)(Trib)

S. 36(1)(iii) : Interest on borrowed capital-Bad Debt-Advance for purchase of material for stock-in-trade-Amount written off-Allowable as deduction. [S. 28 (i)]

K. Patel International v. ACIT (2022) 96 ITR 71 (SN) (Surat) (Trib)

S. 36(1)(iii) : Interest on borrowed capital-Loans and Advances to subsidiaries without charging Interest-Failure to prove for Commercial expediency-Disallowance of interest justified. [S. 37(1)]

BGR Energy Systems Ltd. v. ACIT (2022) 96 ITR 625 (Chennai) (Trib) ACIT v. Sasikala Raghupathy (Smt) (2022)96 ITR 625 (Chennai) (Trib)

S. 36(1)(iii) : Interest on borrowed capital-Real income theory-Interest not accrued to assessee for two preceding year-Accepted by the Department-Disallowance of proportionate notional interest is not justified.[S. 145]

Jindal Steel and Power Ltd. v. Add. CIT (2022)97 ITR 516 (Delhi) (Trib)

S. 36(1)(iii): Interest on borrowed capital-Interest free funds-Interest free loans to subsidiary-Deletion of addition is justified.

Dy. CIT v. Jagson International Ltd. (2022) 97 ITR 176 (Delhi) (Trib) United Spirits Ltd v. Dy.CIT (2022) 97 ITR 272 (Bang) (Trib)

S. 36(1)(iii) : Interest on borrowed capital-Interest-free advance given to subsidiary-No material placed on record by Assessee-Disallowance proper.

Dhanada Corporation Ltd. v. ACIT (2022)100 ITR 10 (SN) (Pune) (Trib)

S. 36(1)(iii) :Interest on borrowed capital-Sufficient interest free funds-Disallowance was deleted.

Narendra Kumar Khandelwal v. ITO (2022)100 ITR 109 (Jaipur)(Trib)