ADANI INFRASTRUCTURE MANAGEMENT SERVICES LIMITED,AHMEDABAD vs. NAFAC DELHI, PRESENT JURISDICTION DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 1(1)(1), AHMEDABAD, AHMEDABAD

ITA 300/AHD/2025Status: DisposedITAT Ahmedabad26 February 2026AY 2021-22Bench: Shri Sanjay Garg (Judicial Member), Shri Makarand V. Mahadeokar (Accountant Member)5 pages
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What did the Tribunal hold?

The Tribunal found that the same interest rate was accepted by the Revenue in an earlier assessment year and that the AO failed to demonstrate the 10.15% rate was above the fair market rate. Citing a High Court judgment, it was held that mere difference in interest rates to various companies does not make the rate excessive. Consequently, the impugned disallowance was ordered to be deleted, and the appeal was allowed.

What were the facts?

The assessee, Adani Infrastructure Management Services Ltd., challenged the CIT(A)'s order which upheld the disallowance of Rs. 1,36,13,995/- under section 40A(2)(b) for excessive interest paid to a related holding company at 10.15%, alleging that loan from an unrelated party was taken at 8.15%. The assessee also raised issues regarding the denial of video hearing and the levying of additional interest under sections 234A, 234B, and 234C.

What were the issues?

1. Whether interest paid to a related party at 10.15% was excessive under section 40A(2)(b) when a similar rate was accepted previously and the AO failed to establish it was above the fair market rate. 2. Whether the CIT(A) erred in not providing a video hearing. 3. Whether additional interest under sections 234A, 234B, and 234C was leviable.

Which sections of the Income-tax Act were involved?

Section 250,Section 40A(2)(b),Section 234A,Section 234B,Section 234C,Section 143(3)

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Income Tax Appellate Tribunal, “A” BENCH, AHMEDABAD

Before: Shri Sanjay Garg & Shri Makarand V. Mahadeokar

For Appellant: Shri Vartik Chokshi, AR
For Respondent: Shri Santosh Kumar, Sr.DR
Hearing: 02/12/2025Pronounced: 26/02/2026

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 12/12/2024 passed u/s.250 of the Income Tax Act, 1961 (her

The order continues below.

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