TMI Blog2012 (7) TMI 345X X X X Extracts X X X X X X X X Extracts X X X X ..... ns received are utilized only for partners personal requirement & non-business use and whereas creditors did not respond to the summons issued by the Assessing Officer during the course of the assessment proceedings disallowance in regard to unexplained cash credit is warranted - remit the matter for reconsideration on the question of adding back of the cash loans and interest thereon for the concerned assessment years - against assessee. - ITA Nos.115, 116, 117, 118, 121, 123 & 124/2012 - - - Dated:- 10-7-2012 - MR. JUSTICE S. RAVINDRA BHAT, MR. JUSTICE R.V. EASWAR, JJ. Ms. Rashmi Chopra, Advocate for Appellant in all Appeals. Mr. K.R. Manjani, Advocate for Respondent in all Appeals. MR. JUSTICE S.RAVINDRA BHAT (OPEN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gross profit addition which have been dealt with by the CIT (Appeals) as well as the Tribunal. The assessee had declared a gross profit depending and based on the peculiar circumstances of each case. With regard to the rate of gross profit and unexplained cash, the decision of the Tribunal is factual and no substantial question of law arises. 3. As far as the addition of the loan amount and the interest component is concerned, the Assessing Officer held as follows: - 2. Loan Creditors: The assessee was required to file details of loans obtained along with the complete particulars of the persons i.e. their names, addresses, PAN particulars, source, financial capacity etc. Assessee has merely filed names addresses with PAN particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 lacs. Therefore, I see no reason to allow interest paid on these loans as business expenditure. I, therefore, disallow 75% of interest paid in each year towards non-business use and for the personal needs of the partners. Firm s fond an interest are being utilized Disallowance of interest an above basis will work out as under: Assessment Year Amount (Rs.) 2000-01 2,10,137 2001-02 9,58,065 2002-03 5,45,173 2003-04 2,70,350 2004-05 3,95,738 2005-06 5,98,725 2006-07 4,63,194 4. The assessee s appeal was considered by the CIT (A) by a common order dated 31.08.2010, allowed the claim with regard to the loan and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the persons are existing assesses, it ipso facto proves the credit worthiness as per 82 TTJ 13. Several judgments have been quoted in support and on these facts of the appellant, no addition in respect of loans and interest thereon is called for. It is also pleaded that similar addition in the case of the sister concern M/s Shri Raghunath Traders has also been deleted except for Rs.2,50,000/- and Rs.1,00,000/- in respect of the parties who have changed either addresses and their present addresses are not known. Appeals against these additions have been filed because taking of the loan does not mean that appellant can keep watch on their movements especially when the loans have already been returned and more than 8 years have passed. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. Learned counsel for the assessee contended that neither in the grounds of appeal by the revenue nor even in the submissions made before the ITAT, was the issue of non-consideration of the remand reports brought to the notice of ITAT. In the absence of such contentions, the ITAT could not be faulted with for overlooking the alleged lapses on the part of the CIT (Appeals). Independently, on merits of the CIT (Appeals) order, counsel highlighted that the reasoning of that body were sufficient to displace the inferences which the Assessing Officer had drawn based upon his own understanding of the record and the material available which included the enquiries made by the Assessing Officer and the material available with the CIT (Appeals). C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Tribunal per se cannot be faulted in not delving into the matter and dealing with the remand reports, what nevertheless is a matter of record is that the CIT (Appeals) even after being aware of the entire circumstances merely proceeded to record the submissions of the Appellant without in any manner indicating the soundness or merit of those arguments. At this stage, this Court is not concerned with the soundness of the reasoning of the CIT (Appeals) or the fact that the CIT (Appeals) did or did not address itself to the remand reports. What strikes this Court is the fact that the Tribunal being the appellate authority vis- -vis CIT (Appeals) was under the duty to satisfy itself that the reasoning adopted by the CIT (Appeals) - in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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