TaxTMI 
TaxTMI 
2016 (7) TMI 313
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....sions of section 263 of the Income Tax Act overlooking the objections raised by the appellant. 2. The learned Commissioner of Income Tax ought to have appreciated that the twin conditions required for invoking the provisions of Section 263 of the Income Tax Act was absent in the appellant's case. 3. The learned Commissioner of Income Tax ought to have met the objections of the appellant and thereafter concluded that, there was error in the order passed by Assessing Officer, causing prejudice to the department. Having not done so, order u/s. 263 is bad in law. 4. The learned Commissioner of Income Tax erred in not entering into a finding as to how interest bearing funds were diverted to sister concerns. Mere mentio....
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....isfied with the reason and explanation of the assessee directed the Assessing Officer to redo the assessment and pass afresh assessment order. The relevant findings of the Ld. CIT are reproduced hereinbelow: "5. I have carefully considered the submission of the Learned AR. The assessee is paying heavy interest to financial institutions for acquiring capital assets and for working capital requirement and at the same time lending to related parties interest-free. As such, proportionate interest is leviable and the same has not been looked into by the Assessing Officer while making assessment inadvertently. 6. In the light of the above, by invoking the provisions of section 263 of the Income Tax Act, 1961, the assessment orde....
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....0 23,69,962.00 ICICI Car Loan (LACOC 00016943231-730d 56,90,06.60 - Tata Finance - Car Loan (5000333104-India DI 2,00,112.27 3,00,600.00 HDFC-Inventory Floor Funding 3,82,53.329.23 - Total 4,98,78,531.20 74,87,709.00 Schedule-4 Unsecured Loan: F.Y. 2009-10 Rs. Ps F.Y. 2008-09 Rs. Ps. Tata Capital Car Loan (7000058961-X6) 53,63,211.60 - Gokulam Chits - 3,44,167.00 ICICI Car Loan - X5 - 60,28,000.00 Platino Cars India Pvt. Ltd., Kochi - 79,89,608.00 Shamina Ashique 19,88,169.40 24,76,912.00 Reliance Capital - Car....
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....nature of rent advance and classified under "Loans & Advances". The building belongs to them and the assessee is pay in grent of Rs. 60 lakhs for that building. The building is used as show room and service centre. 8. As regards advance in the name of the Director, It was in connection withbusiness requirements of the Company and the loan advances were not paid out of borrowed funds. The Assessing Officer was satisfied that there was no diversion of funds during the assessment proceedings. Since theloans/advances have been given for the specific purpose, therefore, the view taken by the Ld. CIT(A) is not a correct view and there cannot be any occasion to come to the conclusion that the order of the Assessing Officer is erroneous in so fa....