TMI Blog2012 (8) TMI 1203X X X X Extracts X X X X X X X X Extracts X X X X ..... he sister concerns. This means that the interest bearing funds have been diverted for non-business purposes and interest should have been disallowed in view of the decision of Hon'ble Punjab Haryana High Court in the case of CIT V. Abhishek Industries, 286 ITR 1. In response to the show cause notice it was mainly submitted that the assessee had surplus funds because from one of the sister concerns the amount payable was ₹ 53,97,047/-, therefore, sufficient funds were available and interest could not have been disallowed. It was also submitted that the decision of Hon'ble Punjab Haryana High Court in case of CIT V. Abhishek Industries (Supra) stood distinguished by the latter decision of Hon'ble Punjab Haryana High Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opies of accounts of the sister concerns which are placed at pages 29 to 33. Page 29 clearly shows that in Mahadev Trading Co. Hathur there was a credit balance of ₹ 53,97,047/- and there was a debit balance amounting to ₹ 6,57,000/-, ₹ 10.00 Lakhs, ₹ 9.85,000 from three sister concerns namely Mahadev Trading Co. Maunke, Mahadev Trading Co. Jagraon, Mahadev Trading Co. Hathur. Thus the assessee had more credits from sister concerns then the debit balances of sister concerns. Therefore, in such a situation the decision of CIT V. Abhishek Industries (supra) is not applicable. In any case there is one of the possible view and the Hon'ble Supreme Court in case of CIT V. Max India Ltd (supra) has clearly held that if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be called to be erroneous or prejudicial to the interest of the revenue. Hon'ble Supreme Court in case of CIT V. Max India Ltd (supra) observed as under:- The phrase prejudicial to the interest of the Revenue in section 263 of the Income-tax Act, 1961 has to be read in conjunction with the expression erroneous order passed by the Assessing Officer. Every loss of revenue as a consequence of an order of the Assessing Officer cannot be treated as prejudicial to the interest of the Revenue. For example, when the Assessing Officer adopts one of two courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the Assessing Officer has taken one view with which the Commissioner does ..... X X X X Extracts X X X X X X X X Extracts X X X X
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