TMI Blog2017 (4) TMI 821X X X X Extracts X X X X X X X X Extracts X X X X ..... e in dispute and accordingly dismiss the ground no. 1 raised by the Revenue. Addition on interest expense - AO made the adjustment stating no interest has been shown in Baddi. - Held that:- The assessee stated that funds on which interest was paid was utilized for Faridabad unit. Hence, Ld. CIT(A) found the merit in the contentions of the assessee. The AO has worked out the interest expenses on a presumptive basis which is not correct. Thus, the Ld. CIT(A) has rightly observed that the amount of ₹ 16,64,268/- is not to be reduced from the profits and not to be added to the total income, which does not need any interference on our part, hence, we uphold the action of the Ld. CIT(A) on the issue in dispute and accordingly, dismiss th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the manufacturing or production business of the assessee. Hence, the Ld. CIT(A) has rightly observed that the interest income may be treated as part of business profits and the amount of ₹ 17,46,414/- was rightly directed to be added to the total income of the assessee, which does not need any interference on our part, hence, we uphold the action of the Ld. CIT(A) on the issue - I.T.A. No. 2293/DEL/2014, C.O. NO. 12/DEL/2015 - - - Dated:- 17-4-2017 - SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER For The Department by : Sh. F.R. Meena, Sr. DR For The Assessee by : S h. Manpreet Singh Kapoor, CA ORDER PER H.S. SIDHU : JM The Revenue has filed this Appeal and Assessee has fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in confirming the additions made by AO in respect to ₹ 17,46,414/- on account of interest on hundi discounting claimed without giving prejudice to the facts of the case. The above ground is independent and without prejudices to another grounds. The appellant prays for leave to add, alter, modify and withdraw any of the grounds either before or at the time of hearing. 4 The brief facts of the case are that the return of income was filed on 29.9.2009 at an income of ₹ 86,94,200/-. The case was processed and subsequently selected for scrutiny under CASS. Notice u/s. 143(2) dated 26.8.2010 was issued and served upon the assessee. In response to the said notice, the AR of the assessee attended the proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A) has elaborately discussed the issues no. 1 to 4 raised in the Revenue s Appeal vide para no. 11.1, 11.3, 11.4 11.5 and also discussed the Issue No. 1 raised in the Assessee s Cross Objection vide para no. 11.2 from pages 23 to 24 of the impugned order which reads as under:- 11.1 The first adjustment made by the AO has been on account of freight charges. The AO stated that the Baddi Unit was purchasing goods from Faridabad unit and not debiting freight charges. The AO has only made presumptions. The appellant has stated that Baddi Unit has incurred ₹ 44,63,799/- on freight and labour in respect of all purchases. Thus, in my view this amount of ₹ 24,53,532/- is not to be reduced from the total deduction claimed and not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this amount. 11.5. The last addition is on account of unproportioned expenses. The AO stated that rent, training charges and other administrative charges were not considered while computing the figure of common expenses. The AO therefore added ₹ 9,15,140/- to the common expenses. The appellant has agreed for ₹ 5,00,970/- but stated that the balance expenses were for the Faridabad Unit only. The contentions of the appellant are accepted. The deduction should be modified accordingly. The ground of appeal is partly allowed. 9.1 On perusing the above finding of the ld. CIT(A), we find that with regard to ground no. 1 raised by the Revenue s Appeal which is relating to adjustment made by the AO has been on account of frei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the Revenue s Appeal on account of presumptive interest expense on account of loan is concerned, we find that the AO stated that no interest charges were booked in Baddi unit. The assessee stated that interest expenses were shown in Baddi unit. . Thus, the Ld. CIT(A) has rightly found the merit in the assessee s contentions. The interest of 12% has been disclosed in the books of account of the Baddi Unit. The addition therefore was rightly deleted by the Ld. CIT(A) and deduction was allowed on this amount, which does not need any interference on our part, hence, we uphold the action of the Ld. CIT(A) on the issue in dispute and accordingly, dismiss the ground no. 3 raised by the Revenue. 9.4 With regard to ground no. 4 raised in the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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