https://www.taxtmi.com/caselaws?id=55024 The tribunal held that the initiation of proceedings under section 147 of the Income Tax Act was solely based on suspicion without reasonable cause, rendering the assessment invalid and bad in law. The tribunal emphasized that mere suspicion cannot justify such proceedings. Regarding the disallowance of interest payable to the bank and UP Finance Corporation Ltd., the tribunal reversed the decision, allowing the appeal by the assessee. It determined that the liability to pay interest accrued yearly under the mercantile system of accounting and was not contingent, thus allowing it as an expenditure in the year of accrual. The assessments for the relevant years were canceled. en-us Wed, 12 Nov 2003 00:00:00 +0530 Tue, 23 Nov 2010 16:26:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=55024 The tribunal held that the initiation of proceedings under section 147 of the Income Tax Act was solely based on suspicion without reasonable cause, rendering the assessment invalid and bad in law. The tribunal emphasized that mere suspicion cannot justify such proceedings. Regarding the disallowance of interest payable to the bank and UP Finance Corporation Ltd., the tribunal reversed the decision, allowing the appeal by the assessee. It determined that the liability to pay interest accrued yearly under the mercantile system of accounting and was not contingent, thus allowing it as an expenditure in the year of accrual. The assessments for the relevant years were canceled. Case-Laws Income Tax Wed, 12 Nov 2003 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=55024