9911796707
TMI Blog2023 (4) TMI 386X X X X Extracts X X X X X X X X Extracts X X X X ..... to as the "Act"), dated 30.03.2015. 2. Revenue has raised the following ground of appeal: 1) "Whether in the facts and circumstances of the case and in law, the Ld. CIT(A) was justified in deleting the addition of Rs. 3,18,14,902/- on account of interest on loan made by the A.O. ignoring the fact that the assessee has failed to substantiate the alleged interest expenses as business expenses where the identity, business activities and genuineness of transactions of loan creditor were not established." 3. Brief facts of the case as culled out from the records are that assessee is engaged in the business of manufacturing of sponge iron Assessee filed its return of income on 30.09.2012 reporting total income nil after setting off brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the Ld. AO, assessee furnished the following further documents in respect of Gateway Commodities Private Limited - a. Confirmation of loan for the period ending on 31.03.2012 and 31.03.2013. b. Financial statements for the year ending on 31.03.2012, 31.03.2013 and 31.03.2018. c. Copy of assessment order passed under section 143(3) of the Act for AY 2012-13, dated 30.03.2015 d. Details of short-term loans and advances as well as other income for the year ending on 31.03.2012. e. Company Master data from the ROC records on MCA portal showing active status of the lender company. 5. It was also submitted that assessee has made payment of interest of Rs.3,18,14,902/- and of Rs.3,71,73,694/- for the year ending on 31.03.2012 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iture attributed to an entity which exist and operate only on paper is a bogus expenditure and not whether this expenditure was for the purpose of business of the assessee. Ld. Senior DR thus urged that the assessment order to be restored by setting aside the order of Ld. CIT(A). 8. Per contra Ld. Counsel for the assessee submitted a one-page synopsis of the case along with paper book containing 56 pages as well as caselaw compilation with five citations. Contentions of the Ld. Counsel are threefold, first being that the lender company has been assessed independently by the Department for the same AY 2012-13 under section 143(3) of the Act vide order dated 30.03.2015. The interest expenditure claimed by the assessee is interest income of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved from four prominent banks including by speed post, effectively demonstrates that it exist on the same address. For the production of director/principal officer of the lender company, Ld. AO never issued summon u/s 131 of the Act. In the first appellate proceedings, Ld. CIT(A) had called for a remand report from the Ld. AO for which a copy is placed in the paper book at page 51-52. Ld. Counsel submitted that even during the remand proceedings though specific request was made to issue summons under section 131 of the Act on the lender company, Ld. AO did not choose to do so. He further submitted that Ld. AO has placed reliance on the report of inspector which was collected behind the back of the assessee and was not shared for its rebutta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being 30.03.2015 which is the same as that in the present case of the assessee, by accepting the interest income earned by the lender company from the assessee. Even in the remand report, Ld. AO has specifically noted that there is no addition under section 68 of the Act but disallowance of interest expense on the unsecured loan from the said lender company. 13. We also note that documents furnished like landline telephone bill, letters served on the assessee from four different prominent banks including a speed post, lends credence to the assertion that lender company existed on the given address, more particularly when the lender company has been assessed by the Department and the assessment order also containing the same address. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of fact arrived at, based on documentary evidence on record cannot be said to be perverse. Nothing has been pointed out that any of the findings arrived at by the Ld. CIT(A) is on the basis of misleading of evidence or failure to examine any material documents while coming to such conclusions. 17. Considering the factual matrix in the present case along with documentary evidences placed on record and the discussion made above, there is force in the submissions made by the Ld. Counsel of the assessee and we find no reason to interfere with the findings given by the Ld. CIT(A) in respect of interest expenditure claimed by the assessee. Accordingly, grounds taken by the Revenue is dismissed. 18. In the result, appeal of the revenue is dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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