TaxTMI 
TaxTMI 
1983 (8) TMI 117
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.... Re. 1 each for the mud and water but, with the passage of time and increase in prices, the assessee had, per force, to pay a higher amount. It was, therefore, claimed that the same should have been allowed. The departmental representative, on the other hand, submitted that there is no scope for interference in the orders of the AAC. After bearing both the parties, we are of the view that he disallowance of Rs. 2,206 was not justified because the assessee had incurred the expenditure, which had not been disputed by the revenue, with the passage of time, higher rates are demanded and the assessee has no option but to pay. We, therefore, see no reason to sustain this disallowance and, as such, the same is deleted. 3. The second disallowance ....
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....interest at 12 per cent, the interest was worked out by the ITO at Rs. 10,322, Rs. 1240 and Rs. 1,350 respectively. The ITO was of the view that the assessee has under-stated the income from interest by not charging interest on the credit balances. These parties were not the relations of the partners of the firm. It is contended before me by the learned authorised Advocate, Shri Goyal, that the interest was not charged in view of the business expediency and that at the calculations of the ITO on the interest rate is erroneous. However, no other reasons were forwarded by Shri Goyal. It is not denied that interest has been charged from various parties with whom the appellant has business considerations. Thus, excluding the parties favourable ....
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.... royalty. Rs. 9,655 on account of royalty were debited in profit and loss account to the agreement entered with one Shri Sultan Singh Amilal. The payment of royalty was scrutinised by the ITO. Royalty was paid for use of land for five years ending on31st July, 1982. A sum of Rs. 6,755 was debited during the accounting period relevant to the assessment year under dispute. It is argued before the ITO that the land which was being used was not very suitable for digging and extracting the soil for manufacture of bricks. The ITO was of the view that, as the agreement was for five years 1/5th of Rs. 9,665 was the correct share of royalty in the account period under reference and added the balance of Rs. 7,724 in the trading account. It is claimed....
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....s no element of enduring nature in the instant case. Five years is too small a period to confer that benefit. Another aspect of the matter is that, when the assessee had paid the amount for taking earth and the land turned out to be rocky, the expenditure could not be thrown out on the ground that he did not dig out earth, because, while entering into an agreement; the assessee could not anticipate that underneath the normal surface of earth, there will be rocks. We, therefore, uphold the order of the Commissioner (Appeals) in this regard. 8. The ITO added a sum of Rs. 12,022 on account of under- valuation of the closing stock at the rate of Rs. 3 per thousand. This was deleted by the Commissioner (Appeals) as follows: "7. The next conten....