TMI Blog2013 (9) TMI 1078X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the purchase. The ld. A.O. had not verified the fact and no inquiry had been made before accepting the assessee’s claim under both the heads. The A.O. raised the query but the assessee did not reply on both aspects before him. The ld. CIT has set aside the order to the A.O. and directed to pass order as per law after proper verification and inquiry. Thus, we have considered view that ld. CIT’s order is not a change of opinion but is as per the Hon’ble Supreme Court decision in case of Malabar Industrial Company Ltd. vs. CIT [2000 (2) TMI 10 - SUPREME Court ]. - ITA No. 2370/Ahd/2009 - - - Dated:- 6-9-2013 - Shri D.K.Tyagi, Judicial Member and Shri T.R. Meena, Accountant Member For the Appellant : Shri M. K. Patel, A.R. Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tified and bad in law. Reliance is placed on the decision of Hon'ble Gujarat High Court in the case of CIT Vs. Arvind Jewellers (2003) 259 ITR 502, 506 (Guj). 3. The learned CIT further erred in not appreciating the fact that when the Assessing Officer made reasonable enquiry on the issues involved and passed order taking into consideration all material and explanation available on record, it could not be said that the Assessing Officer either passed an order without making a reasonable enquiry on the issue involved or passed a order simply accepting what the assessee had stated and failed to make enquiry called for in the circumstances of the case, and as such the order of the Assessing Officer could not be termed as erroneous and p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and for earning the dividend income. The said investment was not made by the assessee in course of his business and therefore, the assessee was not justifying in claiming the entire interest paid on borrowings as allowable deduction u/s. 36(1)(iii) of the IT Act. The A.O. allowed the deduction of ₹ 5,80,773/- on account of interest paid on the unsecured loan of ₹ 1,02,88,009/- without carrying out necessary inquiry. Similarly, the ld. A.O. had not made any inquiry regarding purchases which were admittedly not recorded in the books of account of the assessee at the time of survey could have at a latter stage being debited to the purchase account. The A.O. did not examine whether the debit of ₹ 3,12,427/- in the purchase a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,000/- and source of investment therein. The fund was mixed up i.e. owned fund as well as borrowed fund. The appellant had paid interest of ₹ 5,80,773/-, which has been allowed by the A.O. without verifying. Further, there was a disclosure u/s. 133A of the IT Act on account of excess stock of ₹ 3,11,427/- whereas the appellant also debited the similar amount in purchase account. Effectively, the appellant had neutralized the disclosure by debiting the purchase. The ld. A.O. had not verified the fact and no inquiry had been made before accepting the assessee s claim under both the heads. The A.O. raised the query but the assessee did not reply on both aspects before him. The ld. CIT has set aside the order to the A.O. and directe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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