9911796707
TMI Blog1979 (4) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... f the respective abilities of the loan creditors and in that view erred in allowing the same. 2. That on the facts and in the circumstances of the case, the AAC further erred in allowing Rs. 2,859 paid to M/s. Dawoodi Bohra Merchants Association which was disallowed by the ITO". 2. The facts giving rise to the present appeal before us, are that while computing the income for the asst. yr. under appeal in the case of the assessee, the ITO has partly disallowed cash credits amounting to Rs. 7,500, Rs. 4,000 and Rs. 4,400, thus totalling to a sum of Rs. 15,900 and this amount has been taken as income of the assessee from other sources. 3. During the accounting year relevant to the asst. yr. under appeal there were credits of Rs. 25,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the past. 5. Aggrieved by the order of assessment, the assessee went in appeal and the AAC observed that partial disallowance of the loans was unjustified and accordingly granted full relief to the assessee in respect the total amount Rs. 15,900 and a corollary allowed interest to the extent of Rs. 1530 being the amount disallowed by the ITO on the disallowed part of credits. While allowing relief, the AAC has observed that as the ITO while examining the credits, did not question the existence of he persons, he was not justified in coming to the conclusion that the creditors did not have the ability to give the amounts to the assessee. The AAC further observed that the ITO had unfortunately exceeded the limits imposed on him and he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sworn and attested affidavits, he could not find fault with the contents of the affidavits and, therefore, he could either take the affidavits as a whole as correct, or else, take the said affidavits as a whole incorrect. The ITO could not blow hot and cold in the same breath in respect of a single document and his action in partly allowing the credits on the basis of the very same evidence was contrary to the cannons of natural justice and against the accepted legal principles. 9. As regards the sum of Rs. 2,859, the learned counsel for the assessee contended that had the assessee not given donation to Dawoodi Bohra Merchants Association, the Association could not have afforded financial assistance and facilities to the assessee. Hence, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee which is a firm and the creditors who were a strangers. 11. As regards the disallowance of Rs. 2,859 by the ITO and the relief allowed by the AAC on this point and accordingly hold that the amount was rightly disallowed and added back as income of the assessee on the ground that the assessee had borrowed certain amounts from Dawoodi Bohra Merchants Association that the said association did not charge any interest from the assessee; that the donation made by the assessee was voluntary; that commercial expediency was proved by the assessee by any evidence on record, and that being the position, it could not be said that the payment by the assessee during the year under appeal was actually incurred for and in the course of bu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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