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TMI Blog2014 (3) TMI 846X X X X Extracts X X X X X X X X Extracts X X X X ..... nd letter of credit and that the assessee had borrowed the amount from the bank on interest. The assessee did not place any material on record to show that the fixed deposits were made due to compulsion for procuring import licence and letter of credit and for that purpose the assessee had borrowed the amount from the bank on interest - the jurisdictional Commissioner of Income Tax shall examine the case/record if he deems fit and proper and in exercise of his revisional powers u/s 263 of the IT Act – the Commissioner shall examine whether the assessee is entitled for setting-off of interest earned towards interest paid – Decided in favour of Revenue. - ITA.No.526,525/2007 - - - Dated:- 2-1-2014 - DILIP B BHOSALE AND B MANOHAR, JJ. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 10B of the IT Act can be allowed, and secondly, whether the assessee was entitled for netting of interest. The present appeals, are directed against the findings recorded by the Tribunal on the second ground of challenge. The Tribunal while considering the second ground of challenge in paragraph 5.1 of the order observed thus: 5.1 However, alternative ground raised by the learned counsel which is in respect of netting of interest. It is the case of assessee that the deposits were made due to the compulsion for procuring import licence and letter of credit. For this purpose, the assessee had to borrow amount from the bank on interest. Subsequently, these amounts were deposited in the bank which earned interest. This being the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en submitted that the assessee had made fixed deposits for procuring import licence and letter of credit and for that purpose he had borrowed the amount from the very same bank on interest. In view thereof, he submitted that the assessee was entitled for allowing netting of interest and the assessing officer while passing the order dated 19-11-2007 has rightly granted the relief, though not in respect of entire amount but in respect of the amount mentioned above. He fairly stated that though the order dated 19-11-2007 was not challenged at that stage, the assessee will not have any objection for allowing the Commissioner to invoke his powers under section 263 and examine the legality and correctness of the order passed by the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax shall examine the case/record if he deems fit and proper and in exercise of his revisional powers under Section 263 of the IT Act, issue appropriate directions within 16 weeks from the date of receipt of this order. It is open to the Commissioner to examine whether on the facts and in the circumstances of the case and in law, the Assessing Officer was justified in allowing netting of interest. In other words, the Commissioner shall examine whether the assessee is entitled for setting-off of interest earned towards interest paid. It is needless to observe that if the case of the assessee, as reflected in paragraph 5.1 in the impugned order, is held to be proved, the assessee shall be entitled for netting of interest. 7. The ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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