Tribunal decision: Appeal dismissed, issues remitted, further investigation directed.

The Tribunal dismissed the appeal challenging the rejection of contentions on reopening the assessment for certain years. Regarding the disallowance of interest paid to Canara Bank, the Tribunal remitted the issue back to the Assessing Officer for fresh consideration. Similarly, for the disallowance of commission paid to a non-resident, the Tribunal directed the Assessing Officer to further investigate and asked the assessee to establish the nature of services rendered by the non-resident agent. The Tribunal partially allowed the appeal on the interest paid to Canara Bank and the commission paid to the non-resident for statistical purposes.

---

---

Issues:
1. Rejection of contentions on reopening of assessment.
2. Disallowance of interest paid to Canara Bank on overdraft facility.
3. Disallowance of commission paid to non-resident.

Issue 1: Reopening of Assessment
The assessee's appeal challenged the rejection of contentions by the Commissioner of Income-tax (Appeals) regarding the reopening of the assessment for the years 2004-05 and 2008-09. The authorized representative initially raised this ground but later withdrew it during the hearing. Consequently, the ground was dismissed as not pressed.

Issue 2: Disallowance of Interest Paid to Canara Bank
The Assessing Officer disallowed a sum of Rs. 2,74,165 as interest paid on an overdraft facility, linking it to interest-bearing borrowed funds advanced to relatives. The Commissioner of Income-tax (Appeals) upheld this disallowance, prompting the assessee to appeal. The assessee submitted additional evidence before the Tribunal, arguing that interest-free funds were available and advanced to others without interest. As the lower authorities did not examine these documents, the Tribunal remitted the issue to the Assessing Officer for fresh consideration in the interest of justice.

Issue 3: Disallowance of Commission Paid to Non-Resident
The assessee made a payment of Rs. 4,09,858 as commission to a non-resident, which was disallowed by the Assessing Officer for not deducting TDS under section 195 of the Act. The Commissioner of Income-tax (Appeals) affirmed this disallowance. The authorized representative contended that tax deduction under section 195 is required only when the payment is chargeable to tax in India. The Tribunal observed that the assessee failed to provide evidence of the nature of services rendered by the non-resident agent, leading to a lack of clarity on the business connection in India. Consequently, the Tribunal remitted the issue back to the Assessing Officer for further investigation and directed the assessee to establish the nature of services rendered by the non-resident agent.

In conclusion, the Tribunal partly allowed the appeal related to the disallowance of interest paid to Canara Bank for statistical purposes and allowed the appeal concerning the disallowance of commission paid to a non-resident for statistical purposes. Both issues were remitted to the Assessing Officer for fresh consideration.

---