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TMI Blog2013 (9) TMI 594X X X X Extracts X X X X X X X X Extracts X X X X ..... the case and in law, the ld.CIT(A)-II, Ahmedabad has erred in deleting the addition of Rs.2,39,400/- made by the AO on account of disallowed interest. (3) On the facts and in the circumstances of the case and in law, the ld. CIT(A)-II, Ahmedabad has erred in restricting the addition of Rs.15,000/- to 10% only, made by the AO on account of disallowed office expenses. (4) On the facts and in the circumstances of the case and in law, the ld. CIT(A)-II, Ahmedabad, has erred in restricting the addition of Rs.27,321/- to 10% only, made by the AO on account of disallowed office expenses. 2. The facts of the case are that assessee firm is engaged in the business of "Angadia" i.e. delivery of parcels etc. from one place to another. The order u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... letters dated 9.8.2004 & 16.8.2004 written to Dy. Director of Income Tax (Inv) Unit No.2, Mumbai 3. We have heard the parties. Under similar circumstances, the Tribunal upheld the order of ld. CIT(A) in deleting the addition of the cash on the basis of entries in the cash book. The cash in the case of present assessee and in the case of M/s Patel Natverlal Chnubhai & Co. was being transferred through the same Van which was searched by the Department on 21.7.2004. The Tribunal in this regard had observed in ITA No.737/Ahd/2008 Asst. Year 2005-06 pronounced on 3.9.2010 as under :- "9. From the report, we find that the detailed reasons for making the aforesaid addition are discussed by the AO in para 5 of the assessment order. In para 2 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.25,00,000/-." Since the facts and circumstances of the case are the same, cash was also found recorded in the cash book of the assessee and there is no further evidence to contradict this aspect, we uphold the order of ld. CIT(A) in deleting the addition. Accordingly the first ground raised by the Revenue is dismissed. 4. The second ground relates to deletion of addition of Rs.2,39,400/- by disallowing interest paid on money borrowed. The ld. AO observed that assessee has paid interest on the money borrowed. The cash was kept idle and was not used for the purpose of business. 5. The ld. CIT(A) deleted the addition by holding that merely because assessee is maintaining cash balance it cannot be said that borrowings are not used for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ney borrowed was utilized for non-business purposes the disallowance of interest cannot be upheld. As a result, this ground of Revenue is also rejected. 7. The third and fourth grounds relate to the restricted disallowance to 10% in respect of office expenses. The assessee has claimed an expenditure of Rs.82,123/- under the head office expenses and Rs.1,82,141/- under the head Stationery expenses. The AO disallowed Rs.15,000/- and Rs.27,321/- respectively under the two heads on the ground that these expenses did not relate to business. The ld. CIT(A) restricted the additions to 10% of the total claims. 8. We have heard the parties. There is no case for interference in the order of ld. CIT(A). The estimate made by the ld. CIT(A) is reasona ..... X X X X Extracts X X X X X X X X Extracts X X X X
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