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2012 (12) TMI 249 - ITAT, AHMEDABADAddition made u/s.40A(2)(b) of the Act – interest to sister concerns - Held that:- The A.O. made hypotheticated calculation in assessment order without any base and material. The addition was made on presumption. In both years, there is no nexus between the borrowed fund and interest free loan. The assessee did not take substantial interest in the business of the specified person or the specified person has a substantial interest in the business of the assessee. The A.O. has not brought on record any evidence regarding the assessee has substantial interest in M/s. Yuletide Industries Private Ltd. and M/s Covenent Investment Co. Ltd. and vice versa. Further interest free loan given to alleged sister concern were part consideration of service rendered by both the companies. - In favor of assessee Disallowance on account of adjustment of Excise Duty on purchase, sales and closing stock u/s 145A of the Act – The claim of decrease in profit – Held that:- . In Section 145A, there is an amendment w.e.f. 01.04.1999 in Subclause b of Section 145A. - Adjustment to include the amount to any tax, duty, cess or fee (whatever name called), actually paid or incurred by the assessee to bring goods to the place of its location and condition as on date of valuation is required to adjust as per law by the A.O. Therefore, the A.O. is directed to make suitable adjustment as per law after giving the opportunity of being heard to the assessee. - Accordingly, this issue is set aside to the A.O - appeals are partly allowed and decided for statistical purpose.
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