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2012 (11) TMI 549 - ITAT CHANDIGARHInterest on Advance against Sister Concern for Non - Business Purposes - Held that:- Addition of Rs. 16,510/- (12% of Rs.1,37,577/-) made on account of interest on amount outstanding against the sister concerns of the assesseee considering it advance for non business purposes has to be disallowed – Onus is on the assessee to prove the advance for Business purpose - appeal of the revenue is allowed. Disallowance of Rs.7,68,000/- made on account of interest not declared by the assessee on undisclosed investment of Rs.64 lacs not declared in the books of account - that the impugned addition is consequential in nature and hence, in view of the findings recorded by the ld. CIT(A) and decision of the ITAT in assessee's own case for assessment year 2006-07, the ground of appeal is dismissed. Addition of Rs.4,08,835/- on account of loss of stock - ssessee failed to prove genuineness of the claim - Held that:- Considering totality of circumstances in which claim of loss has been made does not point out to anything other than genuine business loss and therefore the same is allowed - deductible loss – Order of CIT(A) is confirmed. Addition of Rs.18,200/- made u/s 14A – Held that:- Having regard to the exigency of business and the non-optional investment to be made by the assessee on the direction of the Punjab government, the impugned addition cannot be made, as held by the CIT(A ) - ground of appeal of appeal of the revenue is dismissed. Addition of Rs.2,84,420/- made on account of interest capitalized on proportionate basis, pertaining to the pre-operative period - fund borrowed for the purchase of machinery – Held that:- following the decision on identical issue in assessee's own case, this ground of appeal of the revenue is dismissed. Assessee's claim worth Rs. 7,09,457/- in respect of reducing the income Valuation of Closing Stock - CIT(A) considered that if an addition on consistent application of method of accounting is made in any particular year, then allowance for depletion in closing stock worked out on the basis of some accounting method, deserves to be allowed. Accordingly, the claim of the assessee was allowed by the CIT(A) - No infirmity in the findings of the CIT(A), and therefore, the same are upheld. Ground of appeal of the revenue is dismissed - In the result, appeal of the revenue is partly allowed.
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