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TMI Blog2016 (1) TMI 127X X X X Extracts X X X X X X X X Extracts X X X X ..... We find that AO has disallowed the interest amount of ₹ 83,83,743/- on the misunderstanding of the facts given by assessee. In the books of accounts of the assessee there were admittedly interest expenses of ₹ 1,85,62,489.00. The chart filed by the Assessee before the AO showed only the unpaid interest of ₹ 1,01,78,746.00 as on 31.3.1998. Thus there was no discrepancy whatsoever as presumed by the AO. Accordingly we are inclined not to interfere in the order of CIT(A)- Decided against revenue - Decided against revenue Addition out of interest payment to UCO bank though the assessee debited the same in A.Ys 1993-94 & 1994-95 - CIT(A) deleted the addition - Held that:- As find from the observation of AO that interest was debited in earlier years for the same loan for AY 1993-94 for a sum of ₹ 6,68,422/-. In this connection, it was found that interest was debited by assessee on account of some other loan of UCO bank only and this account was maintained by assessee at Guwahati branch of UCO bank and same amount was also settled by assessee with UCO bank. However, as regards interest charged by assessee of ₹ 17,31,894/- on account of AY 1994-95, AO obs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion for want of supporting evidence - CIT(A) deleted the addition - Held that:- The AO has just disallowed the expenses of ₹ 2 lacs on estimated basis which is not justifiable as per the law. The AO failed to provide the specific reason for the disallowance. Therefore we are inclined not to interfere in the order of Ld. CIT(A).- Decided against revenue Interest income treated as business income by CIT(A) - AO treated the same as income from other source and applied Rule-8 of IT Rules, 1962 - Held that:- Since this issue has already been covered by the judgment of Hon'ble jurisdictional High Court in the case of Eveready Industries (India) Ltd. (2009 (12) TMI 226 - CALCUTTA HIGH COURT) in favour of assessee and treating the interest income as "business income" and the same is binding on us. Therefore, we uphold the order of Ld. CIT(A) - Decided against revenue - ITA No. 1122/Kol /2012 - - - Dated:- 24-11-2015 - N. V. Vasudevan, JM And Waseem Ahmed, AM For the Appellant : Shri Pinaki Mukherjee, JCIT-SR-DR For the Respondent : Shri D S Damle, FCA ORDER Per Waseem Ahmed, Accountant Member This appeal by the Revenue is arising out of order of Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oresaid analyzation while following a justice-oriented approach from this perspective, we feel that there is sufficient cause for condoning the delay in the institution of the appeal, hence we are inclined to condone the delay in preferring the instant Appeal . Now let us proceed with the case on merits. First issue 5. First issue raised by Revenue is that Ld. CIT(A) has erred in deleting the addition made by Assessing Officer for ₹ 35,57,392/- in case of Nagrijuli Tea Estates and ₹ 5,38,548/- in the case of Tongani Tea Estates on account of late deposit of PF which is reproduced as under:- That on the facts and circumstances of the case, Ld. CIT(A) erred in law in directing the A.O to delete the addition of ₹ 35,57,392/- in the case of Nagrijuli Tea Estates and ₹ 5,38,548/- in the case of Tongani Tea Estates without appreciating the fact that Section 36(1)(va) deals with contribution to P.F that deductions u/s43B is allowed only in that previous year in which the sum is actually paid within date. 6. Briefly stated facts are that assessee is a limited company and is engaged in the business of growing and manufacturing of tea leaf in India. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eposit as specified under the respective Act. The same disallowance was deleted by the Ld. CIT(A) relying in the decision of Hon'ble Apex Court in the case of Alom Extrusions Ltd.(supra). In view above we allow the claim of the assessee and uphold the order of the CIT(A) deleting the disallowance made on account of delayed payment of PF contribution. This issue of Revenue's appeal is dismissed. Second issue 8. Second issue is regarding the action of the Ld. CIT(A) in directing the AO to delete interest of ₹ 83,83,743 as unexplained expenditure though according to the Revenue assessee failed to furnish the details and addresses of unsecured creditors. 9. During the year, assessee-company has debited interest paid to various parties for an amount of ₹ 1,85,62,489/-. In this regard, AO called upon the assessee to furnish the details of unsecured loan to whom interest was paid. The assessee produced a chart showing the amount of interest paid and provided for an amount of ₹ 1,01,78,746/-. The AO found that there was a difference of ₹ 83,83,743/- between amount of interest claimed as deduction in the profit and loss a/c and details of interest su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 45,00,00/- lakhs from April to June Rs.3,09,22,906/- Less: Settled by bank Rs.5,72,68,000/- Rs.2,63,45,094/- Add: Pay order charges ₹ 75/- Rs.2,63,45,169/- There was a dispute between assessee and the Bank and therefore the assessee did not pay any interest to Bank for the last five years. This interest was not claimed as expense in its books of account. In the settlement with the Bank, the interest was charged for a sum of ₹ 2,63,45,169/-. Since it was not claimed in its books of account in earlier years and this liability got ascertained in the relevant AY only, the entire amount of interest has been claimed as interest expense in this year only. However, the AO found from the previous AYs record that assessee-company has debited a sum of ₹ 6,68,422/- and ₹ 1731894.00 as interest payment to UCO bank in the AY 1993-94 and 1994-95 respectively which is included in the total interest debited in profit and loss account in the relevant A.Y 1998-99. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egards interest charged by assessee of ₹ 17,31,894/- on account of AY 1994-95, AO observed that it has been debited in the books of account of assessee and therefore disallowed. However, Ld. AR has submitted before us that this interest has been reversed in the books of account of that relevant year and in support of its claim a ledger copy of UCO bank in the books of account of assessee is submitted which is placed at page 14 of assessee's paper book, where said interest charged by assessee has been reversed in its books of account in the assessment year 1994-95 only. So it can be inferred that this amount has never been charged in the profit and loss account in its books. From the aforesaid discussion, we find that assessee has not claimed double deduction of interest paid in earlier year and interest paid in relevant year. On this basis, we are inclined not to interfere in the order of Ld. CIT(A) and this ground of Revenue's appeal is dismissed. Fourth issue 15. The issue raised by Revenue in this appeal is that Ld. CIT(A) has erred in deleting the addition of ₹ 2,36,515/- made by AO on account of profit earned from sale of assets. During the year asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal is that Ld. CIT(A) has erred in deleting the addition made by AO for a sum of ₹ 2.40 lakh on account of hire charges. In this case, the AO has disallowed the hire charges expenses claimed by assessee in the relevant year on the ground that no supporting evidence was produced by assessee in assessment proceedings. Therefore, the AO added the same to assessee's income. 19. Aggrieved, assessee preferred appeal before Ld. CIT(A) who has deleted the same by observing that similar expenses were allowed as deduction in earlier years and the relevant documents in support of assessee's claim were produced for verification. Therefore the Ld. CIT(A) has deleted the same 20. Aggrieved, now Revenue is in appeal before us. 21. We have heard rival parties and perused the materials available on record and it is observed from the assessment order that disallowance was made for non-production of details of the parties to whom the payment was made. The Ld. AR drew our attention on page 18 of the paper book, wherein the party, Aparna Sales Pvt. Ltd. has confirmed the expenses of ₹ 2.40 lakh. Since the sufficient details have been furnished by assessee and accordingly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arkets Ltd. The AO treated the same as income from other source in the hands of assessee. The income was claimed by assessee as income from the manufacture of tea and claimed that Rule-8 of the Income Tax Rules 1962 ought to be applied on the said income. The AO rejected the claim of the assessee. Accordingly the AO did not set off this income of ₹ 21,575.00 against unabsorbed depreciation brought forward from earlier years. 26. Aggrieved, assessee filed appeal before Ld. CIT(A) who treated the interest income as income from the manufacture of tea by observing the judgment of Hon'ble jurisdictional High Court in the case of Eveready Industries (India) Ltd. v. CIT 323 ITR 312 (Cal), wherein Hon'ble jurisdictional has held that interest income of an assessee engaged in the business of growing and manufacture of tea is to be assessed as business income subject to Rule 8 of the IT Rule. Accordingly, Ld. CIT(A) has held that interest income is from the business of manufacture of tea in India and set off was allowed. Aggrieved by this order of Ld. CIT(A) now, Revenue is in appeal before us. 27. Before us Ld. AR has submitted that the interest income was shown under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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