TMI Blog2021 (3) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... ty due to M/s New India Roadways is because of a clerical mistake. However, the first appellate authority has not given any credence to such statement of the assessee. Assessee as well as the additional evidences now furnished which, have a crucial bearing in deciding the issue; hence, should be admitted, assessee s claim that the disputed addition of ₹ 20 lakhs actually represents the earnest money deposit with MCGM requires thorough examination. Since, evidences now furnished before the Tribunal were not filed before the departmental authorities, in my view, the issue needs to be remitted back to the Assessing Officer for examining assessee s claim vis- -vis the additional evidences filed by the assessee as well as the evidences ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to maintain the details of all the expenditure incurred on sales promotion and travelling. In view the possibility of inflation of expenditure by the assessee to some extent, in my considered opinion, disallowance of @20% out of the aforesaid expenditures would be fair and reasonable. Accordingly, I direct the AO to restrict the disallowance to 20% of the expenditure claimed towards sales promotion and travelling. This ground is partly allowed. - I.T.A. No. 4886/Mum/2019 - - - Dated:- 25-2-2021 - SHRI SAKTIJIT DEY (JUDICIAL MEMBER) Appellant by : Shri Anant Pai, (AR) Respondent by : Smt. Smita Verma, (DR) ORDER Per Saktijit Dey, JM This is an appeal by the assessee against the order dated 10-05-2019 of learned Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s unexplained cash credit u/s 68 of the Act. The addition so made was also sustained by the Ld.CIT(A) while deciding the appeal. 5. The learned Counsel for the assessee submitted, assessee is a civil contractor and executes work under the Municipal Corporation Of Greater Mumbai (MCGM). He submitted, the amount of ₹ 20 lakhs is a refund of earnest money deposit with the MCGM which was wrongly credited in the ledger account of M/s New India Roadways appearing in assessee s books instead of crediting the deposit account. To demonstrate the aforesaid factual position, learned Counsel drew attention to the ledger account and bank statement copies of which have been placed on record. Further, he submitted, necessary entry rectifying the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the reply furnished by M/s New India Roadways in response to the notice issued under section 133(6) of the Act. However, the learned Counsel for the assessee has submitted before me that due to a clerical mistake, earnest money deposit of ₹ 20 lakhs with MCGM and refund thereof has been wrongly shown as liability against M/s New India Roadways. From the ledger account and bank statement (copies furnished in the paper book), it is seen that an amount of ₹ 20 lakh claimed to be deposit towards earnest money was paid to MCGM on 10-03-2010. Further, from the bank statement it appears that the assessee has received back the said earnest money deposit from MCGM on 19-01-2011. The assessee has also furnished journal voucher and ledge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mining assessee s claim vis- -vis the additional evidences filed by the assessee as well as the evidences already on record. Accordingly, I restore the issue to the file of the Assessing Officer for fresh adjudication after due opportunity of being heard to the assessee. 9. In ground 3, the assessee has challenged disallowance of ₹ 1,78,738/- out of the interest expenditure claimed during the year. 10. Briefly the facts are, in course of assessment proceedings, the Assessing Officer noticed that the assessee has claimed deduction of ₹ 11,25,973/- towards interest paid on loans availed. After calling for necessary details and examining them, he found that while the assessee has paid interest @9% on loan given to related par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner (Appeals). 13. I have considered rival submissions and perused materials on record. Though, it may be a fact that the assessee had availed loan at the interest rate of 12% p.a., whereas, it has advanced loan to a sister concern by charging 9% interest p.a; however, assessee s contention that it is a temporary advance of surplus funds available and was given on the condition that it has to be repaid on call, has not been disputed or denied. The assessee s claim that the rate of interest charged at 9% is more than the prevailing rate of interest on FDRs has not also been found to be false. In such circumstances, if the assessee has parked his surplus fund temporarily by charging interest at 9%, which is more than prevailing ra ..... X X X X Extracts X X X X X X X X Extracts X X X X
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