Addition of Notional Interest Income on Interest Free Advance under the Income Tax Act

Last updated: 22 September 2021

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The Income Tax Appellate Tribunal has ruled on the addition of notional interest income for interest-free advances. The assessee, a partnership firm, had provided interest-free loans to individuals. While interest was charged on one loan, it was not charged on others, with the assessee citing reasons such as business proposals that didn't materialise. The Tribunal allowed the assessee's appeal, deleting the addition made by the Assessing Officer regarding the notional interest on these interest-free loans.

Court :
ITAT Hyderabad

Brief :
This is an appeal filed by the assessee against the order passed by Commissioner of Income Tax (Appeals)-6, Hyderabad dt.1.8.2020.

Citation :
ITA No. 2238/Hyd/2018

Daily Limit Reached