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2017 (5) TMI 532 - AT - Income TaxAdjustment in view of the section 145A - Held that:- As submitted before the assessing officer assessee is following exclusive method of accounting in respect of modvat as prescribed by the accounting standards-2 of the Institute of charted accountants of India and also in accordance with the directions of ITAT Mumbai bench in the case of Hawking’s Cookers Limited vs ITO [2008 (8) TMI 904 - ITAT MUMBAI]. The assessee has also stated that the tax audit report clearly mentions that no adjustment in view of the section 145A of the Income Tax Act is required. The authorities below have rejected the submissions without pointing out any reason as to why the above submissions of the assessee deserve to be rejected. It is settled law that even administrative order have to be consistent with the rules of natural justice. This position was reiterated by the Hon’ble Apex Court in the case of M/s SAHARA INDIA (FIRM) [2008 (4) TMI 4 - Supreme Court ]. Hence in view of the above submissions of the assessee which have not been controverted by the authorities below by a speaking order, we set aside the order’s of the assessing officer on this issue and decide the issue in favour of the assessee. Disallowance u/s.40a(ia) - Held that:- Upon careful consideration we find that Ld. DRP also noted that assessee has furnished evidences and particulars which the DRP wanted the assessing officer to examine and act upon. In the interest of justice we remit this issue again to the file of the assessing officer. Assessing officer is directed to give effect to the direction of the Ld. DRP after giving the assessee proper opportunity of being heard. Addition of interest - Advance given without any purpose for the business carried on by the assessee - Held that:- The deposit was made at the end of the financial year for entering into the agreement for rent for the accommodation to be used by the employee. There was slight delay in finalising the agreement, which can be considered to be reasonable. Hence we agree with the Ld. Counsel of the assessee that facts and circumstances do not warrant and addition of notional income on the deposit in the hand of the assessee. Accordingly we said aside the order’s of the parties below the decide the issue in favour of assessee.
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