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Income Tax Appellate Tribunal, “G”, BENCH MUMBAI
Before: SHRI D.KARUNAKARA RAO & SHRI PAWAN SINGH
Date of Hearing : 24/02/2016 Date of Pronouncement: 29/02/2016 O R D E R
PER PAWAN SINGH, JM:
This appeal is filed by the assessee against the order of CIT(A) -52 Mumbai, dated 29.01.2015 raising only one effective ground regarding disallowance of interest expenses amounting to Rs.1,85,57,586/- for the assessment year 2011-12.
The brief facts of the case are that the assessee filed its return of income on 29.09.2011 declaring total loss at Rs. (-)1,92,45,409/- The return was selected for scrutiny after serving the statutory notice u/s. 143(2). The Assessing Officer, besides the other disallowances, made a disallowance of Rs.18,55,758/- on account of interest expenses. The assessee filed an appeal against the assessment order dated 23.10.2013 before the First Appellate Authority/CIT(A). The same was confirmed by the CIT(A) vide its order dated 29.01.2015 against which the present appeal is filed before us.
At the outset the ld. Authorised Representative (AR) had brought to our notice that similar addition had been made in assessment years 2008-09, 2005-06, 2006-07 and 2007-08 against which the assessee has approached this Tribunal and similar issue was restored to the file of the Assessing Officer vide order dated 15.05.2015. In this regard we perused the said orders of the Tribunal and find that para 24 of the order of the Tribunal for assessment years 2005-06, 2006-07 and 2008-09 is relevant. Considering its importance, the same is extracted as under :-
In view of the above, we restore the matter with regard to disallowance of interest to the file of AO with a direction to decide afresh keeping in view the proposition of law laid down by jurisdictional High Court in the case of Reliance Utilities & Power Ltd., wherein it was held that in case of availability of interest free funds presumption is that the same has been utilized for advancing interest free loans, therefore, no disallowance is to be made. The AO is directed to decide the issue after verifying interest free funds available with the assessee in terms of decision of Hon’ble jurisdictional High Court as well as other High Courts cited hereinabove. We direct accordingly.
The above finding of the Tribunal, is relevant, for deciding the present issue raised in this appeal. Keeping in view the principle of consistency, and following the order of the co-ordinate Bench of the Tribunal, we restore the issue to the file of the Assessing Officer. Therefore, we direct the Assessing Officer to consider the same in accordance with the direction which was given in order dated 15.05.2015
In the result appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on this 29/02/2016.