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TMI Blog2022 (9) TMI 1102X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of law arises for consideration in the present appeal and accordingly the same is dismissed. The Supreme Court in the case of Ram Kumar Aggarwal Anr. vs. Thawar Das [ 1999 (8) TMI 1008 - SUPREME COURT] has reiterated that under Section 100 of the Code of Civil Procedure the jurisdiction of the High Court to interfere with the orders passed by the Courts below is confined to hearing on substantial question of law and interference with finding of the fact is not warranted if it involves re-appreciation of evidence. Supreme Court in State of Haryana Ors. vs. Khalsa Motor Limited Ors.[ 1990 (8) TMI 416 - SUPREME COURT] has held that the High Court was not justified in law in reversing, in second appeal, the concurrent findi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appreciating the facts clearly mentioned in the Assessment Order and without considering that assessee has claimed and received excess incentive on the basis of erroneous declaration. 4. A perusal of the paper book reveals that the CIT(A) noted the objection of the assessee that sufficient opportunity was not given by the Assessing Officer during assessment proceedings and accordingly directed the assessee to furnish details of payments of outstanding balance as on 31 st March, 2014 along with confirmation for fair and proper disposal of the appeal. The assessee submitted details of parties as well as detail of transaction made by the Appellant with said parties during the Financial Year under consideration mentioned in transfer pricin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ables outstanding as on 31st March, 2014, which shows that the said companies also having trade payable against purchases of goods, therefore, the allegation made by the Assessing Officer that such companies do not have creditworthiness to enter into large scale transaction of sale and purchase is factually incorrect. The CIT (A) held that once Assessing Officer has accepted sales and purchase transactions, transfer pricing report at arm's length and book results declared by the Appellant, he is not justified in treating the credit balance of associate parties relating to sales to the Appellant as non-genuine without bringing any adverse material on record. 7. It was also observed by the CIT (A) that the Appellant as well as parties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as the sales has been substantially increased during the year in comparison to the last year. Sales trading results are not disturbed. 3. This finding of Assessing Officer remained undisturbed before the CIT(A) as well and has been accepted by the ITAT. Proceeding on this basis, the ITAT observed that the sales, purchases as well as gross profits as disclosed by the assessee have been accepted by the Assessing Officer. 4. Once this is accepted, we are of the opinion that the approach of the ITAT was correct inasmuch as the Assessing Officer did not consider this aspect while making additions of the sundry creditors under section 68 of the Income Tax Act. As there was no case for disallowance for corresponding purchases, n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... served upon the assessee. During the assessment proceedings the Assessing Officer disallowed Rs. 1,04,000/- paid by the assessee as interest on customs duty demand. The assessee contended that he used to import jewellery manufacturing machinery under Export Promotion Capital Goods Scheme (EPCG Scheme) at a concessional rate with an export obligation which it could not fulfil and was required to pay interest @ 24% per annum to DGFT. The Assessing Officer after considering the contentions of the assessee held that the interest paid by the assessee cannot be allowed as deduction as it was penal in nature and, therefore, fell within the mischief of Explanation below Section 37(1) of the Act. The assessee appealed to the Commissioner (A) who ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t paid was not penal in nature as much as it was as per the declared policy of the government and occasioned by the failure of the assessee to meet its obligations. The amount being interest was compensatory and not penal according to the Tribunal. 4. The counsel for the Revenue attacked the reasoning of the Tribunal contending that since the assessee availed the facility without having fulfilled the obligations, there was a violation of the terms of the scheme, doing something that is prohibited by law. 5. The Revenue, in the opinion of the Court, has been unable to establish that the assessee's conduct was an offence or that it did anything that was prohibited by law. The Assessing Officer has not pointed out which provision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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