TMI Blog2013 (9) TMI 895X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee could not provide any details as directed by the Tribunal and at the time of hearing - assets tried to submit the details before the high court - matter remanded back for reconsideration. Allowance of Interest as expenditure in which year - Assessee has taken the overdraft in the earlier years and claimed the interest payment during the assessment year under consideration – Held that:- Once the assessee has claimed the payment and debited the same then at least the same should have been allowed in any year - Once the payment is genuine and debited in the books of account, the same is allowable. - Income Tax Appeal No. - 82 of 2006, Income Tax Appeal No. - 80 of 2006, Income Tax Appeal No. - 81 of 2006, Income Tax Appeal No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and circumstances of the case, the respondents were justified in treating bifurcation of income of Rs.54,47,486/- less exchange variation difference of Rs.10,59,204/- under rule 115 of the Income Tax Act leaving a balance of Rs.43,88,282/- as part of taxable income instead of treating it as capital appreciation, and not taxable?" ITA No.81 of 2006 "Whether on the facts and circumstances of the case, the respondents were justified in treating bifurcation of income of Rs.3,45,58,315/- less exchange variation difference of Rs.22,35.011/- under rule 115 of the Income Tax Act leaving a balance of Rs.3,23,23,304/- as part of taxable income instead of treating it as capital appreciation, and not taxable?" On 23.01.2008, a Coordinat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ived in foreign currency (Dinars). Due to fluctuation of the foreign currency rate, the A.O. opined that the difference in exchange rate due to conversion of foreign currency into Indian rupee had been kept in the exchange reserve account. So, the credit figure is taxable. The A.O. also observed that credit figure was not similarly credited to the profit and loss account but was instead taken to the Exchange Variation Reserved Account in the balance sheet directly. This change in the accounting pattern was also noticed by the auditor. The A.O. has not accepted it and made the additions. However, the first appellate authority has given a partial relief to the assessee. The Tribunal heard the cross appeals and remanded the matter back to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ratio laid down in the case of Sutlej Cotton Mills Ltd. Vs. Commissioner of Income-Tax, West Bengal, 1979,116 ITR, page 1, where the value of the foreign currency on conversion was declined and there was a loss. The Hon'ble Supreme Court in that situation observed that:- "It is now well settled that the way in which entries are made by an assessee in his books of account is not determinative of the question whether the assessee has earned any profit or suffered any loss. The assessee may, by making entries which are not in conformity with the proper principles of accountancy, conceal profit or show loss and the entries made by him cannot, therefore, be regarded as conclusive one way or the other. What is necessary to be considered is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the details as per direction of the Tribunal. During the curse of arguments, learned counsel submits that the details, as per the direction, are available and he tried to produce before this Hon'ble Court. He also submits that the same details were not examined by the authority below. When it is so, then we modify the impugned order and restore the matter back to the A.O. to verify the details including computation as per direction given by the Tribunal and decide the same as per law. Income-Tax Appeal No.59 of 2008 In this appeal, another issue is pertaining to the interest on bank draft. The A.O. made an addition of Rs.8,35,000/- pertaining to the interest payable on bank drafts. The A.O. found that the assessee has taken the over ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the submission of the learned counsel that this aspect was not examined by the appellate authorities and they summarily confirmed the order passed by the A.O. By considering the totality of the facts and circumstances of the case, we are of the view that once the payment is genuine and debited in the books of account, the same is allowable. It is the claim of the learned counsel that the liability was pertaining to this year and this aspect was not examined by the authorities below. When it is so, then we deem it fit to modify the impugned order and remand this issue to the A.O. to examine the same afresh in the light of above discussions, but providing the reasonable opportunity to the assessee. When both the issues are restored back ..... X X X X Extracts X X X X X X X X Extracts X X X X
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