East India Pharmaceutical Works Ltd. v. CIT

224 ITR 627Supreme Court of India1997#694 most cited

What is East India Pharmaceutical Works Ltd. v. CIT authority for?

Where an assessee has mixed funds (both interest-bearing and interest-free funds) and makes an interest-free advance or investment, it is presumed that the interest-free funds were utilized first if they are sufficient to cover such advances or investments. This prevents disallowance of interest on borrowed funds under Section 36(1)(iii).

146

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2015 to 2026.

Also referred to as

East India Pharmaceutical Works Ltd v CIT · 224 ITR 627 · Section 36(1)(iii) · interest disallowance · mixed fund theory · interest free advances · borrowed funds · commercial expediency · presumption of utilization · interest on borrowed capital

Also reported as

91 Taxmann 185

Sections most often in play

Section 143(1)Section 143(3)Section 1961Section 36(1)(iii)Section 144C(1)Section 144C(5)Section 194JSection 195
Read the full judgment

Issues it is cited on

interest free advancessection 36(1)(iii)advance taxcommercial expediencysection 32section 36(1)section 36section 40(a)capital expendituresection 37(1)section 40section 37

Judgments citing East India Pharmaceutical Works Ltd. v. CIT

ACIT Circle-28(1), Delhi vs. Sam Overseas, New Delhi

In the result, the appeal of the Revenue is dismissed and the appeal of the assessee is allowed

ITA 169/DEL/2021[2011-12]Status: DisposedITAT Delhi22 Jun 2023AY 2011-12

Bench: Shri G. S. Pannua N D Shri Challa Nagendra Prasad

For Appellant: Sr. Advocate
Section 195

…ufficient to meet its investments and at the same time the assessee had raised a loan it can be presumed that the investments were from the interest-free funds available. In our opinion, the Supreme Court in East India Pharmaceutical Works Ltd. vs. CIT [1997] 224 ITR 627 had the occasion to consider the decision of the Calcutta High Court in Woolcombers of India Ltd. [1982] 134 ITR 219.where a similar issue had arisen. Before the Supreme Court it was argued that it should have been presumed that in essence and true character the taxes were paid out of the profits of the relevant year and not out of the overdraft…

Sam Overseas, New Delhi vs. ACIT Circle- 24(1), New Delhi

In the result, the appeal of the Revenue is dismissed and the appeal of the assessee is allowed

ITA 1695/DEL/2020[2011-12]Status: DisposedITAT Delhi22 Jun 2023AY 2011-12

Bench: Shri G. S. Pannua N D Shri Challa Nagendra Prasad

For Appellant: Sr. Advocate
Section 195

…ufficient to meet its investments and at the same time the assessee had raised a loan it can be presumed that the investments were from the interest-free funds available. In our opinion, the Supreme Court in East India Pharmaceutical Works Ltd. vs. CIT [1997] 224 ITR 627 had the occasion to consider the decision of the Calcutta High Court in Woolcombers of India Ltd. [1982] 134 ITR 219.where a similar issue had arisen. Before the Supreme Court it was argued that it should have been presumed that in essence and true character the taxes were paid out of the profits of the relevant year and not out of the overdraft…

Namdeo Indarrao Gore, Pune vs. Deputy Commissioner of Income Tax, Circle-7, Pune

In the result, the appeal is partly allowed

ITA 343/PUN/2023[2014-15]Status: DisposedITAT Pune08 Jun 2023AY 2014-15

Bench: Shri R.S. Syal

Section 14ASection 250

…e disallowed on the basis that the investments were made out of interest bearing funds. In reaching this conclusion, the Hon’ble High Court relied on the judgment of the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. Vs. CIT (1997) 224 ITR 627 (SC). Similar view has been taken by the Hon'ble Dehi High Court in CIT vs. Tin Box Company (2003) 260 ITR 637 (Del), holding that when 5 Namdeo Indarrao Gore the capital and interest free unsecured loan with the assessee far exceeded the interest free loan advanced to the sister concern, disallowance of part of interest out of total intere…

DCIT, C-11(1), New Delhi vs. Hero Motocorp Ltd., New Delhi

Appeal of the Revenue is dismissed

ITA 1982/DEL/2019[2014-15]Status: DisposedITAT Delhi03 Feb 2023AY 2014-15

Bench: Shri Narendra Kumar Billaiya & Shri Kul Bharat

Section 14ASection 2(22)(e)Section 40Section 40a

….41 crores only. In such circumstances, it is to be presumed that only interest free funds have been utilized for making investments during the year. Reference, in this regard, is made to the following decisions: - East India Pharmaceutical Works Ltd. v. CIT: 224 ITR 627 (SC) - CIT v. Reliance Industries Ltd.: 410 ITR 466 (SC) - CIT v. UTI Bank Ltd.: 215 Taxman 8 - The Supreme Court dismissed the revenue’s - SLP in Civil Appeal No. 468/2014 - Woolcombers of India Ltd. v. CIT: 134 ITR 219 (Cal.) - PCIT v. Basti Sugar Mills Co. Ltd.: ITA No. 205 of 2018 (Del HC) - PCIT v. Reebok India Company: [2018] 259 Taxman 100…

M/S Premier Irrigation Adritec (P) Ltd., Kolkata vs. ACIT, Cir-11(1), Kolkata

In the result, the appeal of the assessee is dismissed

ITA 387/KOL/2021[2014-15]Status: DisposedITAT Kolkata20 Jan 2023AY 2014-15

Bench: Shri Sanjay Garg & Shri Girish Agrawal

Section 2(24)Section 250Section 3Section 36(1)Section 36(1)(va)Section 43B

…o. 2527/Ahd/2010 decided on 09.11.2012 has decided the issue in favour of the revenue and disallowed the interest paid on belated deposit of TDS u/s 201(1A) following the Supreme Court decision in the case of East India Pharmaceutical Works Ltd. v. CIT (1997) 224 ITR 627 (SC). The question before the Supreme Court was whether the payment of interest on money borrowed for payment of income-tax was an expenditure laid out wholly and exclusively for the purpose of business as contemplated by sub- section (1) of Section 37 of the Income-tax Act, 1961. The Supreme Court had decided the issue in favour of the revenue a…

Commissioner of Income Tax, Kol-III vs. M/S. Indian Aluminium Co. Ltd

In the result, the appeals filed by the revenue

ITA/96/2007HC Calcutta05 Jan 2023

Bench: : The Hon’Ble Justice T.S. Sivagnanam & The Hon’Ble Justice Hiranmay Bhattacharyya Date : 5Th January, 2023 Appearance : Mr. Om Narain Rai, Adv. …For The Revenue. Mr. J.P. Khaitan, Sr. Adv. Ms. Arati Agarwal, Adv. Ms. Rosy Banerjee, Adv. Mr. Binayak Gupta, Adv. …For The Assessee The Court : These Appeals Filed By The Revenue As Well As The Assessee Under Section 260A Of The Income Tax Act, 1961 (The Act) Are Directed Against The Order Dated October 20, 2006, Passed By The Income Tax Appellate Tribunal `A’ Bench, Kolkata (Tribunal) In Ita 1221/Kol./2006 & Ita 1045/Kol./2006, For The Assessment Year 2002-03. The Appeal Being Ita 173 Of 2007 Was Admitted On 7Th May, 2008 On The Following Substantial Questions Of Law :- “Whether On The Facts & In The Circumstances Of The Case The Learned Tribunal Was Justified In Law In Not Allowing :

Section 14ASection 260ASection 36(1)(iii)Section 43BSection 80I

…ppellant without considering the judgments reported in 284 ITR 619, 100 ITD 199(2004) 1 SOT 210, (vii) A part of interest on borrowed funds without considering the decision of jurisdictional High Court reported in 134 ITR 816 approved by the Supreme Court in 224 ITR 627 and (viii) Interest on borrowed fund under section 36(1)(iii) of the Act without considering the Supreme Court ruling reported in 288 ITR1(SC). 2. Whether on the facts and in the circumstances of the case learned Tribunal was justified in law in making the addition of Rs.22,93,311/- in 3 respect of unutilized MODVAT credit for the relevant pre…

Indian Aluminium Company Limited vs. Commissioner of Income Tax

In the result, the appeals filed by the revenue

ITA/173/2007HC Calcutta05 Jan 2023

Bench: : The Hon’Ble Justice T.S. Sivagnanam & The Hon’Ble Justice Hiranmay Bhattacharyya Date : 5Th January, 2023 Appearance : Mr. Om Narain Rai, Adv. …For The Revenue. Mr. J.P. Khaitan, Sr. Adv. Ms. Arati Agarwal, Adv. Ms. Rosy Banerjee, Adv. Mr. Binayak Gupta, Adv. …For The Assessee The Court : These Appeals Filed By The Revenue As Well As The Assessee Under Section 260A Of The Income Tax Act, 1961 (The Act) Are Directed Against The Order Dated October 20, 2006, Passed By The Income Tax Appellate Tribunal `A’ Bench, Kolkata (Tribunal) In Ita 1221/Kol./2006 & Ita 1045/Kol./2006, For The Assessment Year 2002-03. The Appeal Being Ita 173 Of 2007 Was Admitted On 7Th May, 2008 On The Following Substantial Questions Of Law :- “Whether On The Facts & In The Circumstances Of The Case The Learned Tribunal Was Justified In Law In Not Allowing :

Section 14ASection 260ASection 36(1)(iii)Section 43BSection 80I

…ppellant without considering the judgments reported in 284 ITR 619, 100 ITD 199(2004) 1 SOT 210, (vii) A part of interest on borrowed funds without considering the decision of jurisdictional High Court reported in 134 ITR 816 approved by the Supreme Court in 224 ITR 627 and (viii) Interest on borrowed fund under section 36(1)(iii) of the Act without considering the Supreme Court ruling reported in 288 ITR1(SC). 2. Whether on the facts and in the circumstances of the case learned Tribunal was justified in law in making the addition of Rs.22,93,311/- in 3 respect of unutilized MODVAT credit for the relevant pre…

Addl. CIT, New Delhi vs. M/S Apra Auto India Pvt. Ltd., New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 2763/DEL/2017[2013-14]Status: DisposedITAT Delhi26 Oct 2022AY 2013-14

Bench: Sh. Kul Bharatdr. B. R. R. Kumarita No. 2763/Del/2017 : Asstt. Year : 2013-14 Addl. Cit, Vs M/S Apra Auto India Pvt. Ltd., Special Range-1, K-80, Hauz Khas Enclave, New Delhi-110006 New Delhi (Appellant) (Respondent) Pan No. Aadca3085B Assessee By : Sh. Rajat Jain, Ca & Sh. Akashat Jain, Ca Revenue By : Sh. Kanav Bali, Sr. Dr Date Of Hearing: 25.10 .2022 Date Of Pronouncement: 26.10.2022

For Appellant: Sh. Rajat Jain, CA &For Respondent: Sh. Kanav Bali, Sr. DR
Section 144

…of CIT Vs. Reliance Utilities & Power Ltd. vide order dated 09.01.2009 which has been passed after examining the judgments of Hon’ble Calcutta High Court in the case of Woolcombers of India Ltd. (134 ITR 219) and East India Pharmaceutical Works Ltd. Vs. CIT (224 ITR 627) wherein it was held that where an assessee has his own funds as well as borrowed funds, a presumption can be made that the advances for non-business purposes have been made out of the own funds and that the borrowed funds have not been used for this purpose. 6. Since, it is an undisputed fact that the assessee had own sources to the tune of Rs.…

Deputy Commissioner of Income-Tax, Circle - 1(1), Pune vs. M/S. Associated Blenders Pvt.Ltd, Pune

In the result, the appeal is allowed for statistical purposes

ITA 2922/PUN/2017[2014-15]Status: DisposedITAT Pune18 Oct 2022AY 2014-15

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Raviआयकर अपील सं. / Ita No.2922/Pun/2017 "नधा"रण वष" / Assessment Year : 2014-15

…disallowed on the basis that the investments were made out of interest bearing funds. In reaching this conclusion, the Hon’ble High Court relied on the judgment of the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. Vs. CIT (1997) 224 ITR 627 (SC). Similar view has been taken by the Hon'ble Dehi High Court in CIT vs. Tin Box Company (2003) 260 ITR 637 (Del), holding that when the capital and interest free unsecured loan with the assessee far exceeded the interest free loan advanced to the sister concern, disallowance of part of interest out of total interest paid by the assessee to…

M/S. Keva Construction Pvt. Ltd, Mumbai vs. ACIT -15(2) (1), Mumbai

In the result, appeal filed by the assessee is fully allowed

ITA 758/MUM/2022[2016-17]Status: DisposedITAT Mumbai10 Oct 2022AY 2016-17

Bench: Shri Kuldip Singh & Shri Gagan Goyal

For Appellant: Sh. Saurabh Bhat, C.AFor Respondent: Sh. Tejinder Pal Singh, Sr. DR
Section 36Section 36(1)(iii)

…lders Ltd Vs CIT (2007) 288 ITR-1 (SC.) b) CIT Vs Dalmia Cement (Bharat) Ltd (2002) 254 ITR 377(Del). c) Jurisdictional High court in the case of CIT Vs Reliance Utilities and Power Ltd (2009) 313 ITR 340 (Bom). d) East India Pharmaceutical Works Ltd. Vs. CIT 224 ITR 627 (SC.) [1997] e) Wool Combers of India Ltd. [1981] 7 Taxman 188 (Cal) 6. As far as factual argument of advancing the loans interest free for the purchase of property no evidence in any form has been provided by the assessee before and Ld. CIT (A). 7. AO was not agreed with the legal arguments of the assessee and as mentioned supra assessee furnish…

Sanjay Amlokchand Muthiyan, Principal Commissioner of Income Tax vs. Principal Commissioner of Income Tax, Nashik

In the result, the appeal is allowed

ITA 120/PUN/2021[2015-16]Status: HeardITAT Pune24 Aug 2022AY 2015-16

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Raviआयकर अपील सं. / Ita No.120/Pun/2021 "नधा"रण वष" / Assessment Year : 2015-16

Section 14ASection 263

…the investments were made out of interest bearing funds. In reaching 5 Sanjay Amlokchand Muthiyan this conclusion, the Hon’ble High Court relied on the judgment of the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. Vs. CIT (1997) 224 ITR 627 (SC). More recently, the Hon’ble Supreme Court in CIT(LTU) VS. Reliance Industries Ltd. (2019) 410 ITR 466 (SC) has reiterated the same view. 6. When we examine the amount of Investments at Rs.8.43 crore as against the availability of assessee’s share capital at Rs.17.37 crore, it becomes evident that the amount of such Investments is much les…

JCIT (OSD), Circle 14, Pune vs. Kumar Builder Mumbai Realty Private Limited, Pune

In the result, the appeal filed by the Revenue in ITA

ITA 22/PUN/2020[2014-15]Status: DisposedITAT Pune22 Aug 2022AY 2014-15

Bench: Shri Inturi Rama Rao & Shri S. S. Viswanethra Ravisl.

For Appellant: Shri Nikhil S. PathakFor Respondent: Shri Abhinay Kumbhar &
Section 143(3)Section 14ASection 36(1)(iii)Section 43B

…essee are sufficient to meet the investments with the sister concern, it should be presumed that the investments are made out of the interest free funds. As law laid down by the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. vs. CIT 224 ITR 627 (SC) held that no disallowance of interest is called for relying upon the ratio of the decision of the Hon’ble Supreme Court in the case of CIT vs. Reliance Industries Ltd. 410 ITR 466 (SC). The correctness of this finding of the ld. CIT(A) is under challenge before us vide this ground of appeal no.2 and 3. 13. It is an admitted position that the…

JCIT (OSD), Circle 14, Pune vs. Kumar Urban Development Private Limited, Pune

In the result, the appeal filed by the Revenue in ITA

ITA 21/PUN/2020[2014-15]Status: DisposedITAT Pune22 Aug 2022AY 2014-15

Bench: Shri Inturi Rama Rao & Shri S. S. Viswanethra Ravisl.

For Appellant: Shri Nikhil S. PathakFor Respondent: Shri Abhinay Kumbhar &
Section 143(3)Section 14ASection 36(1)(iii)Section 43B

…essee are sufficient to meet the investments with the sister concern, it should be presumed that the investments are made out of the interest free funds. As law laid down by the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. vs. CIT 224 ITR 627 (SC) held that no disallowance of interest is called for relying upon the ratio of the decision of the Hon’ble Supreme Court in the case of CIT vs. Reliance Industries Ltd. 410 ITR 466 (SC). The correctness of this finding of the ld. CIT(A) is under challenge before us vide this ground of appeal no.2 and 3. 13. It is an admitted position that the…

JCIT (OSD), Circle 14, Pune vs. Kumar Urban Development Private Limited, Pune

In the result, the appeal filed by the Revenue in ITA

ITA 20/PUN/2020[2013-14]Status: DisposedITAT Pune22 Aug 2022AY 2013-14

Bench: Shri Inturi Rama Rao & Shri S. S. Viswanethra Ravisl.

For Appellant: Shri Nikhil S. PathakFor Respondent: Shri Abhinay Kumbhar &
Section 143(3)Section 14ASection 36(1)(iii)Section 43B

…essee are sufficient to meet the investments with the sister concern, it should be presumed that the investments are made out of the interest free funds. As law laid down by the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. vs. CIT 224 ITR 627 (SC) held that no disallowance of interest is called for relying upon the ratio of the decision of the Hon’ble Supreme Court in the case of CIT vs. Reliance Industries Ltd. 410 ITR 466 (SC). The correctness of this finding of the ld. CIT(A) is under challenge before us vide this ground of appeal no.2 and 3. 13. It is an admitted position that the…

Assistant Commissioner of Income-Tax, Circle - 6, Pune vs. Sharada Erectors Private Limited., Pune`

Appeals are dismissed in above terms

ITA 2041/PUN/2017[2011-12]Status: DisposedITAT Pune08 Jun 2022AY 2011-12

Bench: Shri S.S.Godara, Jm & Shri Dr. Dipak P. Ripote, Am आयकर अपीऱ सं. / Ita No.2040 & 2041/Pun/2017 ननधधारण वषा / Assessment Year : 2010-11 & 2011-12

For Appellant: Shri Nikhil PathakFor Respondent: Shri S. P. Walimbe
Section 143(3)Section 36(1)(iii)

…he Hon'ble Bombay High Court noted the judgement of the Hon'ble Calcutta High Court in the case of Woolcombers of India Ltd. vs. CIT 134 ITR 219 (Cal.) which was approved by the Hon'ble Supreme Court in the case of East India Pharmaceutical Works Ltd. vs. CIT 224 ITR 627 (SC) and upheld the proposition that in case both interest-free funds and interest-bearing funds are available discretion lies in the hands of the assessee for utilization of those funds. Thus, the aforesaid plea of the Revenue is untenable. 18. For all the aforesaid reasons, we are inclined to uphold the stand of the assessee. Accordingly, the…

Assistant Commissioner of Income-Tax, Circle - 6, Pune vs. Sharada Erectors Private Limited., Pune`

Appeals are dismissed in above terms

ITA 2040/PUN/2017[2010-11]Status: DisposedITAT Pune08 Jun 2022AY 2010-11

Bench: Shri S.S.Godara, Jm & Shri Dr. Dipak P. Ripote, Am आयकर अपीऱ सं. / Ita No.2040 & 2041/Pun/2017 ननधधारण वषा / Assessment Year : 2010-11 & 2011-12

For Appellant: Shri Nikhil PathakFor Respondent: Shri S. P. Walimbe
Section 143(3)Section 36(1)(iii)

…he Hon'ble Bombay High Court noted the judgement of the Hon'ble Calcutta High Court in the case of Woolcombers of India Ltd. vs. CIT 134 ITR 219 (Cal.) which was approved by the Hon'ble Supreme Court in the case of East India Pharmaceutical Works Ltd. vs. CIT 224 ITR 627 (SC) and upheld the proposition that in case both interest-free funds and interest-bearing funds are available discretion lies in the hands of the assessee for utilization of those funds. Thus, the aforesaid plea of the Revenue is untenable. 18. For all the aforesaid reasons, we are inclined to uphold the stand of the assessee. Accordingly, the…

Atlas Copco (India) Limited, Pune vs. Deputy Commissioner of Income Tax, Pune

In the result, the appeal of the Revenue is dismissed and that

ITA 345/PUN/2017[2012-13]Status: DisposedITAT Pune18 Feb 2022AY 2012-13

Bench: Shri R.S. Syal & Shri Partha Sarathi Chaudhuryआयकर अपील सं. / Ita No.302/Pun/2017 "नधा"रण वष" / Assessment Year : 2012-13 Dcit, Circle-8, Atlas Copco (India) Limited, Pune Vs. Mumbai-Pune Road, Dapodi, Pune – 411 012 Pan : Aaaca4074D (Appellant) (Respondent)

Section 92C

…isallowed on the basis that the investments were made out of interest bearing funds. In reaching this conclusion, the Hon’ble High Court relied on the judgment of the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. Vs. CIT (1997) 224 ITR 627 (SC). Similar view has been taken by the 21 Atlas Copco (India) Limited Asst. Year 2012-13 Hon'ble Dehi High Court in CIT vs. Tin Box Company (2003) 260 ITR 637 (Del), holding that when the capital and interest free unsecured loan with the assessee far exceeded the interest free loan advanced to the sister concern, disallowance of part of int…

Deputy Commissioner of Income Tax, Pune vs. Atlas Copco (India) Ltd, Pune

In the result, the appeal of the Revenue is dismissed and that

ITA 302/PUN/2017[2012-13]Status: DisposedITAT Pune18 Feb 2022AY 2012-13

Bench: Shri R.S. Syal & Shri Partha Sarathi Chaudhuryआयकर अपील सं. / Ita No.302/Pun/2017 "नधा"रण वष" / Assessment Year : 2012-13 Dcit, Circle-8, Atlas Copco (India) Limited, Pune Vs. Mumbai-Pune Road, Dapodi, Pune – 411 012 Pan : Aaaca4074D (Appellant) (Respondent)

Section 92C

…isallowed on the basis that the investments were made out of interest bearing funds. In reaching this conclusion, the Hon’ble High Court relied on the judgment of the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. Vs. CIT (1997) 224 ITR 627 (SC). Similar view has been taken by the 21 Atlas Copco (India) Limited Asst. Year 2012-13 Hon'ble Dehi High Court in CIT vs. Tin Box Company (2003) 260 ITR 637 (Del), holding that when the capital and interest free unsecured loan with the assessee far exceeded the interest free loan advanced to the sister concern, disallowance of part of int…

Deccan Mechanical & Chemical Industires Pvt.Ltd, Pune vs. Deputy Commissioner of Income-Tax, Circle - 8, Pune

In the result, the appeal is allowed

ITA 1663/PUN/2018[2015-16]Status: HeardITAT Pune18 Jan 2022AY 2015-16

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi"नधा"रण वष" / Assessment Year : 2015-16 Deccan Mechanical & Chemical Vs. Dcit, Industries Pvt. Ltd., Circle-8, Khandelwal Jain & Associates, Pune Alankar Cinema Building, Ist Floor, Above United Bank, Pune 411 001 Pan : Aaacd7365G Appellant Respondent

Section 14A

…disallowed on the basis that the investments were made out of interest bearing funds. In reaching this conclusion, the Hon’ble High Court relied on the judgment of the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. Vs. CIT (1997) 224 ITR 627 (SC). Similar view has been taken by the Hon'ble Dehi High Court in CIT vs. Tin Box Company (2003) 260 ITR 637 (Del), holding that when the 4 Deccan Mechanical & Chemical Industries Pvt. Ltd., capital and interest free unsecured loan with the assessee far exceeded the interest free loan advanced to the sister concern, disallowance of part of…

Ub Ajanta Breweries Pvt.Ltd, Aurangabad vs. Assistant Commissioner of Income-Tax, Circle - 2, Aurangabad

In the result, the appeal is allowed

ITA 2952/PUN/2017[2011-12]Status: DisposedITAT Pune18 Jan 2022AY 2011-12

Bench: Shri R.S. Syal & Shri S.S. Viswanethra Ravi"नधा"रण वष" / Assessment Year : 2011-12 Ub Ajanta Breweries Pvt. Ltd., Vs. Acit, (Since Merged With United Breweries Circle-2, Ltd.,), Aurangabad Plot No.H-9 To 11, Midc Waluj, Aurangabad Pan : Aabca6594R Appellant Respondent

Section 143(3)Section 36(1)(iii)

…isallowed on the basis that the investments were made out of interest bearing funds. In reaching this conclusion, the Hon’ble High Court relied on the judgment of the Hon’ble Supreme Court in the case of East India Pharmaceutical Works Ltd. Vs. CIT (1997) 224 ITR 627 (SC). Similar view has been taken by the Hon'ble Dehi High Court in CIT vs. Tin Box Company (2003) 260 ITR 637 (Del), holding that when the capital and interest free unsecured loan with the assessee far exceeded the interest free loan advanced to the sister concern, disallowance of part of interest out of total interest paid by the assessee t…