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TMI Blog2017 (5) TMI 263X X X X Extracts X X X X X X X X Extracts X X X X ..... t no other material was available and the assessee was not at all in position to express even about the services which were availed. The Tribunal after examining all aspects of the matter held that the assessee failed to establish the factum of having service from M/s Singhal’s Resourcing and Marketing Pvt. Ltd. and while doing so also observed that the agreement may be a device adopted to ignore the tax liability. Pertinent to notice that the assessee and M/s Singhal’s Resourcing and Marketing Pvt. Ltd. though are separately assessed to tax, but are closely knitted concerns and the partners are either close relatives or the same persons. In entirety, we do not find any wrong with the findings arrived by the Income Tax Appellate Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne the questions formulated, is that the appellant assessee is a partnership firm engaged in the business of manufacturing and exporting handicraft made by wood, iron, glass, brass etc. For the assessment year 1993-94, a return of income in a tune of ₹ 9,95,553/- was filed by the assessee on 3.2.1994. The Assessing Officer determined the same as of ₹ 13,18,320/- by arriving at the conclusion that no satisfactory explanation is given to divert the business funds to an associate concern without interest, as such, the interest free advance is not allowable. While making assessment as per Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act of 1961 ) the Assessing Officer also ordered to initiate penalty p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscussion made by the Tribunal in this regard reads as follows:- After carefully considering the facts and circumstances and legal position, we give our findings on this issue as under. It is true that there was an agreement between the assessee and M/s Singhal s Resourcing and Marketing Pvt. Ltd. It is also true that the P L a/c of M/s Singhal s Resourcing and Marketing Pvt. Ltd. reveals that it incurred revenue expenditure for giving the said services as has been claimed in the P L a/c. It is also true and clear from the computation of total income of M/s Singhal s Resourcing and Marketing Pvt. Ltd., which proves that it had paid tax at maximum marginal rate on its income. It is also an undisputed fact that the said M/s Singhal s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the findings of the Assessing Officer are not correct. The ld. AR has further submitted that as per the agreement the said company has to perform computerized services, marketing services, consultancy services, correspondence, personal and industrial services, organizational and production services and export financial and maintenance of accounts, etc. He has further submitted that it was agree between the parties that all the equipments would be used by the said company. The company would not claim any right to tenancy, etc. The service charges @ 2% on sales was agreed by the assessee to the said company. The only submission with regard to the particular services having been rendered by the company are that the said company performed its d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may dismiss the appeal by holding that same do not involve any substantial question of law. Heard learned counsels and examine the record. As already stated, the only argument advanced is that the findings arrived by the Income Tax Appellate Tribunal are based on surmises and conjectures and not on adequate appreciation of the material available as well as the legal provisions applicable. From perusal of the order passed by the Income Tax Appellate Tribunal, the relevant portion of that has already been quoted above, we do not find that the Tribunal arrived at the conclusions on basis of surmises and conjectures, but the Tribunal noticed that an agreement between the assessee and M/s Singhal s Resourcing and Marketing Pvt. Ltd. was t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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