The ITO, Ward-1,, Palanpur v. M/s. Jyotindra Brothers, Palanpur

ITA 2936/AHD/2011 | 2008-2009
Pronouncement Date: 24-04-2015 | Result: Dismissed

Appeal Details

RSA Number 293620514 RSA 2011
Assessee PAN AABFJ6482C
Bench Ahmedabad
Appeal Number ITA 2936/AHD/2011
Duration Of Justice 3 year(s) 4 month(s) 26 day(s)
Appellant The ITO, Ward-1,, Palanpur
Respondent M/s. Jyotindra Brothers, Palanpur
Appeal Type Income Tax Appeal
Pronouncement Date 24-04-2015
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 24-04-2015
Date Of Final Hearing 31-03-2015
Next Hearing Date 31-03-2015
Assessment Year 2008-2009
Appeal Filed On 28-11-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD BEFORE SHRI RAJPAL YADAV JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI ACCOUNTANT MEMBER ./ ITA NO. 2936/AHD/2011 / ASSESSMENT YEAR: 2008-09 ITO WARD-1 PALANPUR VS M/S. JYOTINDRA BROTHERS JYOTINDRA GROUP COMPOUND AHMEDABAD HIGHWAY PALANPUR PAN : AABFJ 6482 C CO NO. 05/AHD/2012 ( IN ITA NO.2936/AHD/2011: AY 2008-09) M/S. JYOTINDRA BROTHERS PAN : AABFJ 6482 C VS ITO WARD-1 PALANPUR / // / (APPELLANT) / // / (RESPONDENT) REVENUE BY : SHRI DINESH SINGH SR. DR. ASSESSEE(S) BY : SHRI S. N. SOPARKAR AR !'# $ %&'/ // / DATE OF HEARING : 31/03/2015 () $ %&' /DATE OF PRONOUNCEMENT: 24/04/2015 *+ *+ *+ *+/ // / O R D E R PER SHRI ANIL CHATURVEDI ACCOUNTANT MEMBER: THIS IS AN APPEAL FILED BY THE REVENUE AND THE CR OSS-OBJECTION FILED BY THE ASSESSEE BOTH AGAINST THE ORDER OF TH E COMMISSIONER OF INCOME TAX (APPEALS)-XX AHMEDABAD DATED 12.09.2011 FOR ASSESSMENT YEAR 2008-09. 2. THE BRIEF FACTS OF THE CASE AS CULLED OUT FROM THE RECORDS ARE AS UNDER:- ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 2 - 3. THE ASSESSEE IS A PARTNERSHIP FIRM STATED TO BE ENGAGED IN THE BUSINESS OF DEALING IN PSYLLIUM SEEDS. THE ASSESSE E FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2008-09 ON 16.09.2008 DE CLARING TOTAL INCOME AT RS.1 19 530/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED U/S 143(3) OF THE ACT VIDE OR DER DATED 24.12.2010 AND THE TOTAL INCOME WAS DETERMINED AT RS 35 24 160 /-. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER THE ASSESSEE CARRIED TH E MATTER BEFORE THE LD CIT(A) WHO VIDE ORDER DATED 12.09.2011 GRANTED SUBS TANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE AFORESAID ORDER OF THE L D CIT(A) THE REVENUE IS NOW IN APPEAL BEFORE US AND THE ASSESSEE HAS ALSO F ILED CROSS-OBJECTION. 4. THE GROUNDS RAISED BY THE REVENUE IN ITS APPEAL READ AS UNDER:- 1. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS)-XX AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.15 15 785/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF REJECTING THE BOOKS RESULTS U/S 145(3) FALL IN GROSS PROFIT / DIFFERENCE IN SALES. 2. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS)-XX AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE DISALLOWA NCE OF RS.13 93 195/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF INTERES T EXPENSES. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. COMMISSIONER OF INCOME-TAX (APPEALS)-XX AHMEDABAD OUGHT TO HAVE UP HELD THE ORDER OF THE ASSESSING OFFICER. 4. IT IS THEREFORE PRAYED THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME- TAX (APPEALS)-XX AHMEDABAD MAY BE SET-ASIDE AND TH AT OF THE ASSESSING OFFICER BE RESTORED. 5. ON THE OTHER HAND THE ASSESSEE HAS TAKEN FOLLOW ING GROUNDS IN ITS CROSS-OBJECTIONS:- LD. CIT (A) ERRED IN CONFIRMING DISALLOWANCE OF RS. 4 95 651/- OUT OF INTEREST EXPENSES CLAIMED BY HOLDING THAT ADVANCES GIVEN TO SWATI AUTOLINK PVT LTD WERE FROM INTEREST BEARING FUNDS IGNORING THE FACT THAT COMPLETE DETAILS OF THE AVAILABILITY OF INTEREST FREE FUNDS IN EARLIER YEAR WHEN ADVANCES WERE GIVEN WERE SUBMITTED AND NO DISALLOWANCE FROM INTER EST EXPENSES WAS ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 3 - WARRANTED. LD. CIT(A) OUGHT TO HAVE DELETED SUCH DI SALLOWANCE OF INTEREST EXPENSES INCURRED FOR THE PURPOSE OF BUSINESS OF TH E APPELLANT. 6. FIRST WE TAKE-UP THE REVENUES APPEAL. 7. THE GROUND NO.1 OF THE REVENUES APPEAL IS WITH RESPECT TO THE REJECTION OF ASSESSEES BOOKS RESULT U/S 145(3) OF THE INCOME-TAX ACT. 8. DURING THE COURSE OF ASSESSMENT PROCEEDINGS ON PERUSING THE DETAILS OF INWARDS AND OUTWARDS OF ISPAGHULA SEEDS THE ASSESSING OFFICER NOTICED THAT THE QUANTITATIVE INFORMATION WITH RESP ECT TO INWARD AND OUTWARD OF ISPAGHULA SHOWN BY THE ASSESSEE WAS NOT RECONCILED. HE ALSO NOTICED THAT THE ASSESSEES SUBMISSION OF LOSS DUE TO INFESTATION WAS NOT DEBITED IN THE PROFIT AND LOSS ACCOUNT. HE WAS THE REFORE OF THE VIEW THAT THE ASSESSEE WAS NOT SHOWING THE TRUE FACTS IN THE BOOKS OF ACCOUNTS. FURTHER THE ASSESSING OFFICER NOTED THAT THE ASSES SEE HAD NOT PRODUCED ANY EVIDENCE OF INFESTATION/LOSS OR SHORTAGE. HE ACCORD INGLY CONSIDERED THE BOOKS OF ACCOUNTS OF THE ASSESSEE TO BE DEFECTIVE A ND REJECTED THE BOOK RESULT OF THE ASSESSEE U/S 145(3) OF THE INCOME-TAX ACT. HE WAS FURTHER OF THE VIEW THAT THE SUBMISSION OF THE ASSESSEE OF INC URRING OF LOSS OF RS.14 LACS ON ACCOUNT OF INFESTATION AND WHICH HAS RESULTED IN TO FALL IN GP WAS NOT ACCEPTABLE AS ACCORDING TO HIM THE FALL IN GROSS PR OFIT WAS ALSO NOT EXPLAINED BY THE ASSESSEE. HE THEREFORE AFTER CON SIDERING THE DIFFERENCE IN GROSS PROFIT AS COMPARED TO IMMEDIATELY PRECEDING Y EAR WORKED OUT THE GROSS PROFIT AT RS.9 76 201/- FOR THE YEAR UNDER CO NSIDERATION AND THE DIFFERENCE IN SALES IN THE QUANTITATIVE FIGURES AS WORKED OUT BY HIM WAS RS.15 15 785/- WAS ADDED TO THE INCOME. AGGRIEVE D BY THE ORDER OF THE ASSESSING OFFICER THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A) WHO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE DELETED THE ADDITION VIDE ORDER DATED 12.09.2011 BY HOLDING AS UNDER:- ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 4 - 4.2(I) THE CONTENTIONS OF THE LEARNED AR IN BRIEF A RE THAT COMPLETE TALLY AND RECONCILIATION OF PURCHASES AND SALES OF ISABGHULA SEEDS WAS FURNISHED TO THE AO VIDE LETTER DATED 27-1-2010; THE BOOKS OF ACCOUN TS OF THE APPELLANT ARE DULY AUDITED U/S 44AB; THE REASONS FOR FALL IN GP W ERE EXPLAINED IN THE LETTER DATED 26-11-2010 SUBMITTED TO THE AO AND THE REFORE IMPUGNED ADDITION WAS UNCALLED FOR BOTH ON FACTS AND IN LAW . 4.3 I AM INCLINED TO ACCEPT THE CONTENTIONS OF THE LEARNED AR. THE IMPUGNED AMOUNT OF RS.15 15 785/- REPRESENTED LOSS OF 43 555 KGS OF ISPAGHULA SEEDS DULY ACCOUNTED FOR IN THE AUDITED ACCOUNT OF THE AP PELLANT. THE BASIS ON WHICH THE RECONCILIATION OF THE SEEDS SUBMITTED BY THE APPELLANT AND THE REASONS FOR THE FALL IN GP EXPLAINED BY THE APPELLA NT WERE REJECTED BY THE AO IS NOT FOUND LOGICAL. THEREFORE I HOLD THAT TH E IMPUGNED ADDITION IS NOT SUSTAINABLE. IT IS DELETED. THESE GROUNDS OF APPEAL ARE ALLOWED. 9. AGGRIEVED BY THE AFORESAID ORDER OF THE LD. CIT( A) THE REVENUE IS NOW IN APPEAL BEFORE US. BEFORE US LD. DEPARTMENT AL REPRESENTATIVE SUPPORTED THE ORDER OF THE ASSESSING OFFICER. ON T HE OTHER HAND LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE REITERATE D THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER AND THE LD. CIT(A) AND SUPPORTED THE ORDER OF THE LD. CIT(A). HE ALSO PLACED ON RECORD THE EXTRA CT OF STOCK REGISTER AT PAGE NOS.37 TO 40 OF THE PAPER-BOOK IN SUPPORT OF HIS CO NTENTION THAT THE STOCK RECORDS WERE RECONCILED. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD. CIT(A) WHILE DELETING THE ADDITION HAS GIVEN A FINDING THAT THE AMOUNT OF LO SS OF RS.15 15 785/- REPRESENTED LOSS OF 43 555 KGS OF ISPAGHULA SEEDS W HICH HAVE BEEN DULY ACCOUNTED FOR IN THE AUDITED ACCOUNTS OF THE ASSESS EE AND THE ASSESSEE HAD ALSO SUBMITTED THE PROPER RECONCILIATION AND REASON S FOR THE FALL IN GROSS PROFIT. BEFORE US THE REVENUE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF THE LD. CIT(A). WE THE REFORE FIND NO REASON TO INTERFERE WITH THE ORDER OF THE CIT(A). HENCE THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 5 - 11. GROUND NO.2 OF THE REVENUES APPEAL IS WITH RES PECT TO THE DELETION OF DISALLOWANCE OF RS.13 93 195/- MADE BY THE ASSES SING OFFICER ON ACCOUNT OF INTEREST EXPENSES. 12. ON PERUSING THE PROFIT AND LOSS ACCOUNT OF THE ASSESSEE THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD SHO WN NET INTEREST INCOME OF RS.11 81 410/- AFTER THE SET OFF INTEREST EXPEN SES OF RS.24 88 291/-. HE ALSO NOTICED THAT THE ASSESSEE HAS GIVEN RS.4 35 50 183/- TO SWATI AUTOLINK PVT LTD ON WHICH IT HAD CHARGED INTEREST AT THE RAT E OF 6.75%; BUT ON THE OTHER HAND THE ASSESSEE WAS PAYING INTEREST AT 9%. THE SUBMISSION OF THE ASSESSEE THAT ITS WEIGHTED AVERAGE INTEREST COST WA S 4.91% AS AGAINST WHICH IT HAD CHARGED AT 6.75% INTEREST ON M/S. SWATI AUTO LINK PVT LTD WAS NOT FOUND ACCEPTABLE TO THE ASSESSING OFFICER AS THE AS SESSEE HAD NOT FURNISHED ANY CASH FLOW STATEMENT TO JUSTIFY ITS CLAIM OF NOT ADVANCING INTEREST BEARING FUNDS TO ADVANCING AMOUNTS AT LOWER INTERES T. HE THEREFORE CALCULATED THE INTEREST EXPENSES AT 2.25% ON THE LO AN OF RS.4 35 50 183/- GRANTED TO M/S. SWATI AUTOLINK PVT LTD AND WORKED O UT DISALLOWANCE OF INTEREST AT RS.9 79 880/-. THE ASSESSING OFFICER A LSO NOTICED THAT THE ASSESSEE HAD GIVEN INTEREST FREE LOANS AGGREGATING TO RS.1 00 99 625/- TO (I) JYOTINDRA ORGANICS (II) JYOTINDRA TEXTILES (III) N.N. INDUSTRIES (IV) SWATI PSYLLIUM PVT LTD AND (V) SWATI AGROTECH PVT LTD. H E WAS ALSO OF THE VIEW THAT THE ASSESSEE HAS UTILIZED INTEREST BEARING FUN DS FOR ADVANCING NON- INTEREST BEARING LOANS. HE ACCORDINGLY CALCULATED THE INTEREST EXPENSES AT 9% ON THE AMOUNT ADVANCED AND WORKED OUT THE INTERE ST EXPENSES OF RS.9 08 966/- AND THUS MADE AN AGGREGATE DISALLOWAN CE OF RS.18 88 846/-. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER TH E ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A). THE LD. CIT(A) AFTE R CONSIDERING THE SUBMISSIONS OF THE ASSESSEE GRANTED PARTIAL RELIEF BY HOLDING AS UNDER:- ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 6 - 5.3 WHILE MAKING THE IMPUGNED DISALLOWANCE THE AO OBSERVED THAT APPELLANT HAD BORROWED FUNDS AT THE RATE OF 9% AND ADVANCED TO M/S. SWATI AUTOLINK P.LTD. AT A LOWER RATE OF 6.75%. ACCORDING LY HE CALCULATED INTEREST @ 2.25% ON THE LOAN ADVANCED OF RS. 4 35 50 183/-; AND WORKED OUT THE ADDITION OF RS.9 79 830/-. FURTHER THE AO CALCULAT ED INTEREST AT THE RATE OF 9% ON THE INTEREST FREE LOANS GIVEN TO 5 OTHER CONC ERNS TOTALING TO RS. 1 00 99 625/- AND WORKED OUT THE DISALLOWANCE OF RS .9 08 966/-. PUT TOGETHER HE MADE DISALLOWANCE OF RS. 18 88 846/-. 5.4 THE CONTENTIONS OF THE LEARNED AR IN THIS REGAR D IN BRIEF ARE AS FOLLOW: AO DID NOT CONSIDER THE DETAILED SUBMISSION MADE BY THE APPELLANT VIDE HIS LETTER DATED 1-12-2010.; THE ADVANCE GIVEN TO SWATI AUTOLINK WAS REDUCED DURING THE YEAR; COMPLETE DETAILS OF THE AVAILABILI TY OF INTEREST FREE FUNDS IN EARLIER YEAR WHEN ADVANCE WAS GIVEN WERE SUBMITTED VIDE THE LETTER DATED 1- 12-2010 AND THEREFORE IMPUGNED DISALLOWANCE IS UN WARRANTED. IN SUPPORT THEREOF HE RELIED ON THE CASE LAWS REPRODUCED ABOVE . 5.5 AS SEEN FROM THE DETAILS FURNISHED APPELLANT W AS HAVING NON-INTEREST BEARING FUND OF RS. 3 16 20 869/-. AFTER DEDUCTING INTEREST-FREE ADVANCES TOTALING TO RS. 1 00 99 6257-TO THE 5 CONCERNS MENT IONED BY THE A.O. AT PARA 4.1 OF THE ASSESSMENT ORDER APPELLANT WAS LEF T WITH RS. 2 15 21 244/- OF NON-INTEREST BEARING FUNDS. THUS OUT OF ADVANCE GIV EN TO SWATI AUTOLINK OF RS. 4 35 50 183/- WAS OUT OF INTEREST-FREE FUNDS T HE SUM OF RS. 2 15 21 244/ LEAVING THE BALANCE OF RS. 2 20 28 939/- ADVANCED O UT OF FUNDS BORROWED ON INTEREST @ 9%. THE ADVANCE WAS GIVEN ON INTEREST @ 6.75%. THEREFORE I CONSIDER IT REASONABLE TO WORK OUT THE DISALLOWANCE OF INTEREST @ 2.25% (9% MINUS 6.75%) ON RS.2 20 28 939/- WHICH WORKS OUT TO RS.4 95 651/-. THUS DISALLOWANCE OF INTEREST OF RS.4 95 651/- IS UPHELD . BALANCE DISALLOWANCE OF INTEREST OF RS.13 93 195/- IS DELETED. THUS GROUND OF APPEAL IS PARTLY ALLOWED. 13. AGGRIEVED BY THE ORDER OF THE LD. CIT(A) THE RE VENUE IS IN APPEAL BEFORE US AND THE ASSESSEE HAS ALSO FILED CROSS-OBJ ECTIONS FOR THE PARTIAL DISALLOWANCE. BEFORE US LD. DEPARTMENTAL REPRESE NTATIVE SUBMITTED THAT IN THE ABSENCE OF CASH FLOW STATEMENT THE ASSESSIN G OFFICER WAS JUSTIFIED IN MAKING THE ADDITION. HE THUS SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 14. THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESS EE ON THE OTHER HAND SUBMITTED THAT THERE WAS NO QUESTION OF DISALLOWING ANY INTEREST EXPENDITURE AS THE ASSESSEE HAS EARNED NET INTEREST INCOME OF RS.11 81 410. ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 7 - HE FURTHER POINTED TO THE STATEMENT WHICH WAS PLACE D AT PAGE NO.46 OF THE PAPER-BOOK AND DEMONSTRATED THAT WEIGHTED AVERAGE I NTEREST COST WAS 4.91% AND IT HAS CHARGED INTEREST FROM ON M/S. SWAT I AUTOLINK PVT LTD AT 6.75% AND THUS IT HAS NOT ADVANCED MONEY TO M/S. S WATI AUTOLINK PVT LTD AT LESSER RATE THAN ITS COST OF FUNDS. HE FURTHER SUBMITTED THAT WHEN THE ASSESSEE WAS HAVING SUFFICIENT INTEREST FREE FUNDS PRESUMPTION WOULD BE THAT THE AMOUNT HAS BEEN ADVANCED OUT OF INTEREST F REE FUNDS AND NOT BORROWED FUNDS AND FOR WHICH HE PLACED RELIANCE ON THE DECISION OF BOMBAY HIGH COURT IN THE CASE OF CIT VS. RELIANCE U TILITIES AND POWER LIMITED REPORTED IN (2009) 313 ITR 340 (BOM) AND G UJARAT HIGH COURT IN THE CASE OF CIT VS. RAGHUVIR SYNTHETICS LTD REPORT ED IN 354 ITR 322. HE FURTHER SUBMITTED THAT THE AMOUNT HAD BEEN ADVANCED IN EARLIER YEARS ALSO BUT NO DISALLOWANCE WAS MADE IN THE EARLIER YEARS A ND THEREFORE NO DISALLOWANCE CAN BE MADE IN THE YEAR UNDER CONSIDER ATION AND FOR WHICH HE PLACED RELIANCE ON THE DECISION OF HONBLE KARNATAK A HIGH COURT IN THE CASE OF CIT V. SRIDEV ENTERPRISES REPORTED IN (1991) 19 2 ITR 165 (KAR). HE FURTHER SUBMITTED THAT NO DISALLOWANCE AT ALL ON AC COUNT OF INTEREST WAS CALLED FOR. 15. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS UNDISPUTED FACT THAT DU RING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAS EARNED NET INTEREST INCOME OF RS.11 81 410/-. BEFORE US THE LD. AUTHORIZED REPRESENTATIVE ALSO P OINTED OUT TO THE COST OF FUND THE RATE AT WHICH IT HAS LENT AND FROM THE S TATEMENT SUBMITTED BY THE LD. AR IT IS SEEN THAT THE AMOUNT WHICH HAS BEEN L ENT TO M/S. SWATI AUTOLINK PVT LTD IS AT A HIGHER RATE THAN THE WEIGH TED AVERAGE COST OF FUNDS. BEFORE US IT IS ALSO THE ASSESSEES SUBMISSION THA T THE AMOUNTS WERE ADVANCED IN EARLIER YEARS ALSO AND NO DISALLOWANCE WAS MADE IN THE EARLIER YEARS FOR WHICH RELIANCE WAS PLACED ON JUDGMENT OF THE HONBLE KARNATAKA ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 8 - HIGH COURT IN THE CASE OF SRIDEV ENTERPRISES (SUPRA ). WE FIND THAT THE HONBLE KARNATAKA HIGH COURT HAS HELD AS UNDER:- HELD THAT THE AMOUNT DUE FROM N ON THE FIRST DAY OF THE ACCOUNTING YEAR WAS THE AMOUNT THAT STOOD OUTSTANDING ON THE LAST D AY OF THE PREVIOUS ACCOUNTING YEAR AND THEREFORE ITS NATURE AND STAT US COULD NOT BE DIFFERENT FROM ITS NATURE AND STATUS AS ON THE LAST DAY OF TH E PREVIOUS YEAR. REGARDING PAST YEARS THE ASSESSEES CLAIM FOR DEDUCTION WERE ALLOWED IN RESPECT OF THE SUMS ADVANCED DURING THOSE YEARS. THIS COULD BE ONL Y ON THE ASSUMPTION THAT THOSE ADVANCES WERE NOT OUT OF BORROWED FUNDS OF THE ASSESSEE. THIS FINDING DURING THE PREVIOUS YEARS WAS THE VERY BASI S OF THE DEDUCTIONS PERMITTED DURING THE PAST YEARS. IT WOULD NOT BE EQ UITABLE TO PERMIT THE REVENUE TO TAKE A DIFFERENT STAND NOW IN RESPECT OF THE AMOUNTS WHICH WERE THE SUBJECT-MATTER OF PREVIOUS YEARS ASSESSMENTS. BEFORE US THE REVENUE HAS NOT BROUGHT ANY MATERIA L ON RECORD TO CONTROVERT THE ABOVE SUBMISSIONS MADE BY THE ASSESS EE NOR HAS BROUGHT ANY CONTRARY BINDING DECISIONS IN ITS SUPPORT NOR C OULD POINT OUT ANY DISTINGUISHABLE FEATURES OF THE DECISIONS CITED BY LD. AR. IN VIEW OF THE ABOVE FACTS WE ARE OF THE VIEW THAT NO DISALLOWANC E ON ACCOUNT OF INTEREST COULD BE MADE IN THE PRESENT CASE. WE THEREFORE DIRECT THE ASSESSING OFFICER TO DELETE THE DISALLOWANCE MADE ON ACCOUNT OF INTEREST EXPENSES. THUS THIS GROUND OF THE REVENUE IS DISMISSED AND C ROSS-OBJECTION FILED BY THE ASSESSEE IS ALLOWED. 16. IN THE COMBINED RESULT THE APPEAL OF THE REVEN UE IS DISMISSED AND CROSS-OBJECTION FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 24 TH APRIL 2015 AT AHMEDABAD. SD/- SD/- (RAJPAL YADAV) JUDICIAL MEMBER (ANIL CHATURVEDI) ACCOUNTANT MEMBER AHMEDABAD; DATED 24/04/2015 *BIJU T PS ITA NOS. 2936/AHD/2011 & CO NO.5 /AHD /2012 ITO VS. JYOTINDRA BROTEHRS AY 2008-09 - 9 - *+ $ % -* % *+ $ % -* % *+ $ % -* % *+ $ % -* %/ COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. % !. / CONCERNED CIT 4. !. ( ) / THE CIT(A)-XX AHMEDABAD 5. 12 %' / DR ITAT AHMEDABAD 6. 23 4# / GUARD FILE. *+'! *+'! *+'! *+'! / BY ORDER //TRUE COPY// 5 55 5/ // / 6 6 6 6 (DY./ASSTT.REGISTRAR) / ITAT AHMEDABAD