TMI Blog2015 (9) TMI 1361X X X X Extracts X X X X X X X X Extracts X X X X ..... ct method. In view of the fact that there are fluctuations in price of waste on day to day basis, the correct method is to compare the rates of purchases made by the appellant from sister concerns at a particular point of time by comparing the same with the rates given for the similar goods to other outside parties at the same point of time. As mentioned above the relevant details were duly produced at the time of assessment proceedings but the AO chose to ignore the evidence. As submitted by the appellant, date wise and item wise detail of material purchased from related concern and outside independent parties in the month of November 2006, January 2007, February 2007 and March 2007 payment made to M/s Malwa Cotton Spinning Mills for purchase of Comber Waste and Flat Waste was neither excessive nor unreasonable. Keeping in view the above position, the addition made by the Ld. AO on this account is deleted - Decided against revenue. Disallowance of bank charges amounting - ITAT deleted the addition - Held that:- These expenses have been incurred by the appellant on account of processing fees paid by the appellant to bank to process the working capital facility to meet day to da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... debited huge amount to profit and loss account on account of interest expenditure. On the other hand he is advancing interest free loan to its subsidiary company? ii) Whether on the facts and circumstances of the case the Hon'ble ITAT Chandigarh Bench is justified in upholding the decision of Ld. CIT(A); deleting the addition of ₹ 2,77,318/- made u/s 40A(2)(b) as the assessee has inflated the purchases made from M/s Malwa Cotton Spinning Mills Ltd.? iii) Whether on the facts and circumstances of the case the Hon'ble ITAT Chandigarh Bench is justified in upholding the decision of Ld. CIT(A); deleting the addition of ₹ 22,41,628/- on account of bank changes without appreciating that the assessee company has made addition in fixed assets during the A.Y. Under consideration? iv) Whether on the facts and circumstances of the case the Hon'ble ITAT Chandigarh Bench is justified in upholding the decision of Ld. CIT(A); deleting the addition of ₹ 3,06,251/- expenses incurred on account of building repair without appreciating the fact that whether the expenses are of recurring nature or it is making addition to the fixed assets? 2. Briefly stated, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... building repair were deleted by the CIT(A) without appreciating that the assessee had made addition in fixed assets and the expenses were of recurring nature. 5. After hearing learned counsel for the revenue, we do not find any merit in the said submissions. The CIT(A) while deleting the addition of ₹ 2,90,652/- made by the Assessing Officer under Section 36 (1)(iii) of the Act had relied upon the earlier order passed by the Tribunal in the case of the assessee for earlier and subsequent years on account of the same reasons. The CIT(A) had noticed as under:- 4.3. I have carefully considered the appellant's submission. Appellant has claimed that the advances were given to subsidiary company for business purpose. The appellant has relied on the judgments of Hon'ble Supreme Court in the case S.A. Builders Ltd. v. Commissioner of Income Tax reported in 288 ITR 1 . It is seen that similar addition had been made in appellant's case during the assessment years 2005-06 and 2006-07 and the addition was deleted by CIT(A) following the decision of the Hon'ble Supreme Court in the case S.A. Builders Ltd. Vs. Commissioner of Income Tax. The order of the CIT(A) ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... than flat waste and variation in average price during the month is because purchase piece of cotton comber waste and fine waste have been taken together. To see if the company has made excess payment it would be important to compare the item wise prices. As mentioned in the assessment order details for such purchases made on specific dates of the month of November 2006 from related concern and from parties other than the sister concerns were duly produced before the A.O. and it was contended that on the date on which flat waste was purchased from M/s Malwa Cotton Spinning Mills Ltd., the rates of same item purchased from outside parties was higher. However, the AO did not accept this explanation and this evidence and observed that the assessee has inflated the purchases made from M/s Malwa Cotton Spinning Mills Ltd. In my opinion the Assessing Officer was not justified in observing as above. I agree with the Ld. counsel that the method adopted by the A.O. for comparing the rates of purchases made from the sister concerns is not correct method. In view of the fact that there are fluctuations in price of waste on day to day basis, the correct method is to compare the rates of purcha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the bank every year. As pointed out by the AR of the appellant, it is seen that similar addition had been made during the Asstt. Years 2005-06 and 2006-07 and the addition was deleted by CIT(A). The order of the CIT(A) has been upheld by the Hon'ble ITAT for both the Asstt. Years in ITA No. 696/Chandi/ 2008 for Asstt. Year 2005-06 and ITA No. 1169/Chandi/2009 for Asstt. Year 2006-07. Similar addition made in the case of appellant for A.Y. 2008- 09 has also been deleted by me vide my order dated 07.03.2012. Respectfully following the decision of the Hon'ble ITAT, the addition made by the Ld. AO of ₹ 222,41,628/- on this account is deleted. This ground of appeal is accordingly allowed. 10. The Tribunal had affirmed the said deletion. Again, learned counsel for the revenue was not able to displace the reasoning and the findings of fact recorded by the CIT(A) and the Tribunal so as to raise any law point. 11. Lastly, while deleting the addition of ₹ 3,06,251/- made by the Assessing Officer on account of building repair and maintenance expenses, the CIT(A) had held as under:- 7.3. I have carefully considered the appellant's submission. The fact rem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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