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TMI Blog2017 (10) TMI 1537X X X X Extracts X X X X X X X X Extracts X X X X ..... the appeals together and disposing of the same by this common order. 2. Shri G. Baskar, the Ld.counsel for the assessee, submitted that the assessee is a partnership firm. One of the partners, namely, Shri Rafeeq Ahmed is holding 35% of shares in M/s Abdul Wahid Tanneries Pvt. Ltd. According to the Ld. counsel, there was a business transaction between Shri Rafeeq Ahmed and M/s Abdul Wahid Tanneries Pvt. Ltd. In fact, the assessee-partnership firm was purchasing finished leather from M/s Abdul Wahid Tanneries Pvt. Ltd. for manufacturing shoe and shoe uppers regularly. During the financial year ending 31.03.2012, according to the Ld. counsel, M/s T. Abdul Wahid & Co. owed to M/s Abdul Wahid Tanneries Limited a sum of Rs. 6,31,49,548/- toward ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t one of the partners, namely, Shri Rafeeq Ahmed was holding 35% of shares in the Pvt. Ltd. company. A sum of Rs. 2 Crores for assessment year 2012-13 was transferred from sundry creditor to unsecured loan. According to the Ld. D.R., the assessee claimed before the Assessing Officer and the CIT(Appeals) that merely because a credit was found in the journal entry, it cannot be construed as loan or advance. The CIT(Appeals) by placing reliance on the decision of this Tribunal in ACIT v. Gurbinder Singh (2012) 19 taxmann.com 89, found that even though the credit was provided by making journal entries, it has to be assessed as deemed dividend. Hence, according to the Ld. D.R., the CIT(Appeals) has rightly confirmed the order of the Assessing Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany, not being a company in which the public are substantially interested, of any sum (whether as representing a part of the assets of the company or otherwise) made after the 31st day of May, 1987, by way of advance or loan to a shareholder, being a person who is the beneficial owner of shares (not being shares entitled to a fixed rate of dividend whether with or without a right to participate in profits) holding not less than ten per cent. of the voting power, or to any concern in which such shareholder is a member or a partner and in which he has a substantial interest (hereafter in this clause referred to as the said concern) or any payment by any such company on behalf, or for the individual benefit, of any such shareholder, to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r under Section 2(22)(e) of the Act is deleted. 9. The assessee has taken one more ground regarding disallowance of interest on the delayed payment of sales tax. 10. Shri G. Baskar, the Ld.counsel for the assessee submitted that the interest on delayed payment of sales tax is only compensatory in nature, therefore, it cannot be disallowed while computing total income. 11. We have heard Ms. S. Vijayaprabha, the Ld. Departmental Representative also. Delayed payment of interest is compensatory in nature, therefore, this Tribunal is of the considered opinion that for delayed payment of sales tax, the interest paid by the assessee cannot be disallowed while computing the total income. 12. The next issue arises for consideration is disallowan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We have considered the rival submissions on either side and perused the relevant material available on record. The assessee claims that interest paid on credit card is only for the purpose of business and the Department contends that the personal element cannot be ruled out. In those circumstances, this Tribunal is of the considered opinion that the expenditure incurred by the assessee through credit card needs to be examined. If the payment was made only for business purpose, then there cannot be any disallowance of interest. In case, the credit card was used for meeting personal expenditure, then such expenditure cannot be allowed. Therefore, these aspects need to be verified. Accordingly, orders of both the authorities below are set asi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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