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2017 (1) TMI 1144 - ITAT RAJKOTRevision u.s 263 - assessee has arranged his affairs in the proprietorship concern vis-à-vis partnership in such a manner where at the cost of proprietorship, partnership was allowed to earn more income which is tax free, and therefore, a prejudice has been caused to the Revenue - assessee borrowed unsecured loans and paid interest - Held that:- Most of the credit balance in the accounts is on account of sales made by M/s.Meera Impex. If any investment has been made that was made out of personal books and duly reflected. It was not from interest bearing funds. This argument has been jettisoned by the ld.Commissioner by making a reference of total business vis-à-vis sundry debtors. Both the issues are altogether non-comparables, specifically by making reference in terms of percentage. How it can be alleged that total unsecured loans taken by the assessee in Meera Impex should be used in the items sold to partnership concern only then business needs will be accepted. The loan was taken for the business purpose of Meera Impex. It cannot be assumed that it was used only in sales made to Metal Alloys. It might have been used for other business needs of Meera Impex. The ld.Commissioner failed to take note of the fact that the assessee was holding a capital of ₹ 415.90 lakhs and noninterest bearing funds of ₹ 60.37 lakhs. These two amounts itself can take care of, if any outstanding balance was available towards M/s.Metal Alloys Corporation. These facts have been highlighted in the written submission filed before the ld.Commissioner. The ld.Commissioner failed to take cognizance of these facts in right perspective. We are of the view that the ld.Commissioner was not justified in taking action under section 263 of the Income Tax Act, 1961, therefore, we allow the appeal of the assessee
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