2012 (12) TMI 483

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....mpany providing services in shares and securities. For the relevant assessment year the assessee claimed expenditure towards payment of interest at Rs.1,84,469. The AO while completing the assessment u/s 143(3) disallowed payment of interest on the ground that in absence of production of details regarding purpose of payment of interest it cannot be inferred that payment of interest was exclusively for the purpose of business. 3. The assessee being aggrieved filed an appeal before the CIT (A). Before the CIT (A) the assessee contended that interests were paid to Suresh Chand Golecha (HUF) and Mahesh Chand Golecha (HUF) on the outstanding unsecured loan taken from them for the purpose of business. By advancing the money received the ass....

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....isions in the case of M/s. Merlyn Shipping & Transports vs. ACIT reported in 16 ITR (AT) 1. We therefore direct the AO to delete the addition of Rs.1,77,330. The ground raised by the assessee is allowed. 6. Ground No.(ii) relates to addition of Rs.2,90,000/- being unexplained credits in the name of Smt. Indira Golecha. In course of the assessment proceeding the AO found that the assessee had taken unsecured loan of Rs.3,72,648/- from Smt. Indira Golecha. In response to queries made by the AO, the assessee furnished confirmation letter from the creditor. The AO however alleging that the assessee had not produced sufficient details to cross verify the genuineness and creditworthiness of the investor added the amount to the total income. ....

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....Rs.2,90,000/- solely on the reasoning that cash was deposited in her bank account before the loan was advanced by her to the assessee. This by itself cannot be a ground to disbelieve the advancement of loan of Rs.2,90,000/- to the assessee without making proper enquiry to find out whether the creditor had sufficient cash balance with her to advance the loan. We therefore restore this issue to the records of the AO with a direction to make proper enquiry in the matter and call for such evidence from the assessee to find out the creditworthiness of the creditor and thereafter complete the assessment. The AO shall afford a reasonable opportunity of being heard to the assessee. 9. Ground No.(iii) relates to disallowance of Rs.58,684/- u/s 40....