TaxTMI 
TaxTMI 
2015 (4) TMI 789
X X X X Extracts X X X X
X X X X Extracts X X X X
....est. Consequently, no verification/examination was done on the claim of loan transaction and interest paid thereon. 3. On the facts and circumstances and in law, the order of the CIT(A) on the above grounds may be restored to the AO for verification as the order was passed u/s 144 of the Act." 3. Brief facts of the case are that, the assessee is an individual carrying on the business of wholesale trading from his proprietary concern, M/s. Jain Enterprises. From the perusal of the assessment order, it is seen that various notices were issued to the assessee, however, no response or compliance was made by the assessee. Accordingly the assessing officer completed the assessment u/s 144, after making the following conditions:- Returned income, as per return. Add:- Rs.2,66,836/- (a) On account of the interest Rs.22,00,234/- (b) Any other income for Rs. 14,153/- (c) On account the Rent Rs. 7,85,400/- (d) Unexplained Income Rs. 3,78,544/- (e) 20% of 5,11,926 on Account expenses Rs. 1,02,385/- Rs.34,80,716/- Total income Rs.37,47,552/- Rounded off to Rs.37,47,550/-" 4. Before the Ld. CIT(A), the assessee submitted that, all the notices issued by the asse....
X X X X Extracts X X X X
X X X X Extracts X X X X
....genuineness of the said transactions. (d) Any other income: The assessee has now submitted the ledger account of the transaction. However the assessee had already offered this income to tax in the Rol. Addition by the AO has resulted in double taxation. (e) Rent paid: The assessee has now submitted the ledger account of the transactions and the rent agreement. On the basis of the record submitted there appears to be no reason to prima facie doubt the genuineness of the said transaction. (f) Unexplained income: The AD had added Rs. 3.78.544/- on the basis of the TDS details available in the RoI. The assessee has no I-V submitted the Ledger account of the transactions pertaining to the assessee and(a)Aciel Creations(Rs 3,49,200/-) (b) S A Jewels (Rs 29,344/-) and (c) Smt. Jayanti I Jain ( Rs. 16,043/-). The total of all the three transactions amount to Rs. 3,78,544/-. An amount of Rs. 3,78,544/- has been returned as income from other sources by the assessee in his Rol. However, in the column appearing in the Rol pertaining to TDS details, the assessee has claimed that the said amount has been received from Aciel Creations (Rs 3.49,200/-) and one Vimalkumar F Jain (Rs 29,344/-). T....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nding the assessment proceedings as none of the notices issued by the AO could be served upon the assessee due to change of address. Before the Ld. CIT(A), assessee submitted all the necessary information and details and has explained the entire matter duly supported by evidences relating to additions made by the AO. The Ld. CIT(A) has taken note of this fact and has remanded the matter to the AO to examine all the information and details and to submit his remand report. In the remand proceedings, the assessing officer has not only verified the details but has also carried out detail scrutiny. Thereafter, he has given his comments accepting the assessee's explanation which are corroborated by material placed on record. Regarding interest on loans, the assessing officer has categorically held that genuineness of the said transaction cannot be doubted. She submitted that, once the loan which was taken in the earlier year have been held to be genuine by the AO in the remand proceedings, then interest paid on such loans cannot be disallowed, specially when TDS has been deducted on payment of the interest to the parties. Regarding disallowance of expenses also, she submitted that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....they are unverifiable. He has simply stated that it is not clear as to, from where the figure of Rs. 5,11,926/- has been taken by the AO in the original assessment order, when the assessee has debited the amount in the P/L account at Rs. 7,16,723/-. In the absence of any adverse comment with regard to un-verifiability of expenses, we do not find any reason to sustain any part of the disallowance on ad hoc basis. Thus, the finding of the Ld. CIT(A) which is completely based on remand report of the AO is upheld. Accordingly, the ground raised by the department stands dismissed. 9. Now we will take up Cross Objection filed by the Assessee, vide which the following grounds have been raised:- 1. Under the facts and circumstances of case and in law, the learned Assessing Officer (AD) has erred in objecting the judicious approach adopted by the learned CIT(A) by way of a remand report after concluding the remand proceedings in the due course of law. 2. Under the facts and circumstances of case and in law; the learned AO erred in objecting the judicious view taken by the learned CIT(A) regarding the allowance of the legitimate interest expense in his speaking order. 3. Under the facts ....