The appeal filed by the assessee is against the disallowance on account of interest paid on loan to bank under Section 43B of the Act. The assessee claimed that the interest liability was outstanding at the beginning of the financial year and was paid during the year, as evidenced by the tax audit report and the bank statement.

The AO and the CIT(A) rejected the claim on the ground that the entries in the loan account statement were not clear, carried non-descript narrations of the entries in the loan account and held that such payments appeared to be in the nature of rebate or discount received by the assessee. The assessee submitted date-wise details of the repayment of interest on term loan and buyers’ credit to the CIT(A), but the CIT(A) ignored them and confirmed the addition. The ITAT set aside the order of the CIT(A) and remanded the matter back to the AO for fresh examination of the issue.  (AY. 2018-19)