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TMI Blog2023 (11) TMI 731X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the ld. CIT(Appeals) has erred in confirming the addition of Rs. 10,38,950/-. 3. Brief facts of the case are that the assessee-firm is engaged in the business of finance as a commission agent, trading in shares and investment in Mutual Funds. It has filed its return of income on 30.09.2014 declaring total income of Rs. 32,52,238/-. The case of the assessee was selected for scrutiny assessment and a notice under section 143(2) was given. The ld. Assessing Officer has observed that the firm has debited interest expenditure of Rs. 3,20,38,862/- against unsecured loan taken. He further observed that the assessee has shown interest income of Rs. 2,38,36,768/- against loan advanced by it. The ld. Assessing Officer thereafter reproduced t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere making the payment of interest prior to the accounting year relevant to this assessment year. But in this year, they have not paid the interest nor returned the money. Thus according to the assessee, even its principal was at a stake and, therefore, it did not account for the interest income from these loans. 6. On the other hand, ld. D.R. relied upon the order of the ld. Assessing Officer. 7. On due consideration of the facts and circumstances above, the assessee has demonstrated that it is in the business of finance. It has earned interest income on the loans advanced by it at Rs. 2.38 crores during this activity, there could be certain situation, where it failed to receive interest from all its loanees. The ld. Assessing Officer ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [Addition: Rs. 25,305/-] 3.7. The assessee has claimed following expenditure as business expenditures the Profit & Loss Accounts for the A.Y. 2014-15:- SI No Depreciation Amount 1. Motor car expenses Rs. 460966/- 2. Motor car Insurance Rs. 18915/- Total Rs. 4,79,881/- During the course of assessment proceedings, the A/R of the assessee firm was asked to furnish logbook in order to verify the business usage of car. Since, the assessee has failed to furnished log book and also no explanation was forthcoming from A/R of assessee, the motor car expense is not fully verifiable and also personal use of cars cannot be ruled out altogether. Therefore, 1/5th of such expenses as well as depreciation on car i.e. Rs. 95 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovides its services to such tea estates with regard to tea plantation, planning, management, quality control in manufacturing, tea tasting etc. It has shown a receipt at Rs. 53,47,763 towards as commission for providing such services. The ld. Assessing Officer has unnecessarily disbelieved the vouchers of petty expenses for adopting a method of disallowing expenditure on adhoc basis. He has not specifically pointed out which vouchers were doubtful and how the nature of expenses could be construed as not related to the business. Therefore, the findings of the ld. Assessing Officer is not sustainable. Disallowance out of the first head of expenditure is deleted. 14. As far as disallowance out of car expenditure is concerned, that assessee-co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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