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Ito vs Davinder Hide Co. on 25 January, 2007 cites

Malwa Cotton Spg. Mills Ltd. vs Assistant Commissioner Of Income-Tax on 11 November, 1994

12. This is also the ratio of the decision in the case of Malwa Cotton Spinning Mills v. Assistant Commissioner (supra) and CIT v. Sridev Enterprises (supra) wherein it was held, inter alia, that where the assessing officer had failed to establish any nexus between funds borrowed on interest and amount invested in the plot, there was no justification for making any disallowance out of interest expenditure.
Income Tax Appellate Tribunal - Chandigarh Cites 13 - Cited by 1 - Full Document

Commissioner Of Income-Tax vs Sridev Enterprises on 28 January, 1991

12. This is also the ratio of the decision in the case of Malwa Cotton Spinning Mills v. Assistant Commissioner (supra) and CIT v. Sridev Enterprises (supra) wherein it was held, inter alia, that where the assessing officer had failed to establish any nexus between funds borrowed on interest and amount invested in the plot, there was no justification for making any disallowance out of interest expenditure.
Karnataka High Court Cites 1 - Cited by 157 - Full Document

Commissioner Of Income-Tax, Bombay ... vs Crawford Bayley & Co. on 14 March, 1976

6.1. Before the learned Commissioner (Appeals), the assessee contended, inter alia, that the construction of the complex could not start, because the plan was not sanctioned by the Municipal Corporation, Jalandhar, and the money was received back from the company in June, 2003, amounting to Rs. 10 lacs and in September, 2003, amounting to Rs. 18.50 lacs; that as per the agreement, the second instalment was to be paid by the assessee firm to the company by 31-5-1997, or before the completion of the first floor of the commercial complex, whichever was earlier, but it was not paid, since the company had not been able to obtain the permission from the Municipal Corporation, Jalandhar, for construction of the commercial complex; that it was beyond the power of the assessee to get back the amount from the company earlier than 2003, when it was returned after repeated requests; that even otherwise, the addition was not called for, since the assessee did not suffer any interest loss, as the assessee had accepted family deposits of Rs. 18,78,905, on which, no interest was paid and further, there was sufficient credit balance of the partners, i.e., opening capital of Rs. 39,88,498 and closing capital of Rs. 44,00,744; that the partners could have got interest @ 18 per cent, but were paid interest only @ 8 per cent, on the net balance; that the notional interest on the capital short-charged by the partners and the notional interest on the interest-free deposit worked out to be much more than the notional interest on the alleged interest-free advance; that the assessing officer had not established any nexus between the money advanced and the money borrowed; that as per the balance sheet filed, for the year ending 31-3-1996, the assessee had a bank liability of only Rs. 10,89,269 in the year in which the money was advanced, which was much lesser than the amount advanced, i.e., Rs. 28,50,000; that even in the earlier year, when the money had not been advanced, the bank liability of the assessee was of Rs. 10 lacs only; that the ratio of 78.15 per cent : 21.85 per cent had been calculated by the assessing officer with regard to the secured loans outstanding as on 31-3-2001 and the advance made in 1995-96, and this could not form the basis for making the addition in the year under consideration; that there was no material on record to prove that the advance for purchase of the building was made by the assessee from the secured loans raised from banks; that V.I. Baby (supra) was distinguishable on facts; and that no disallowance should have been made when the money was advanced in the earlier years and no addition had been made in the earlier years on such advances on account of interest-free advances.
Bombay High Court Cites 3 - Cited by 53 - V D Tulzapurkar - Full Document
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