TaxTMI 
TaxTMI 
2016 (7) TMI 1317
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....t case, the assessee is engaged in the business of manufacturing and sale of gold ornaments. The AO found that the assessee has paid rent of Rs. 1,31,180/- as ornaments rent. The assessee explained that the amount was paid to relatives of the assessee whose ornaments the assessee has taken on rent. It was submitted that the assessee has received 9812.050 gms. of gold ornaments on rent. It was submitted that the assessee's firm uses gold for manufacturing of gold ornaments and by taking the gold ornaments on rent, it does not require to buy fresh gold bullion from the market. The family members whose ornaments are lying idle by this way can earn interest income. It was submitted that the cost of taking gold on rent was much less i.e. 1 % to ....
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.... further submitted that in assessment year 2004-05, the assessee claimed deduction for rent for use of gold ornaments at Rs. 1,31,180/-, which was accepted by the Department u/s 143(1) of the Income-tax Act, 1961. He further submitted that in assessment year 2005-06, the assessee claimed deduction for rent for gold ornaments at Rs. 1,31,180/-, which was also accepted by the Department u/s 143(1) of the Act. Therefore, it was his submission that consistency should be maintained in income tax proceedings and on this principle no disallowance should be made for rent for gold ornaments. 6. The ld. Departmental Representative on the other hand supported the orders of the lower authorities. 7. I have heard the rival submissions and have perused....
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....assessee. 11. I find that the Hon'ble Supreme Court in the case of CIT vs. Excel Industries Limited, (2013) 358 ITR 295( S.C.) held that in case of consistent view taken in favour of the assessee on questions, the Court will not take a different view without very convincing reasons. Therefore, following the rule of consistency as in earlier assessment years, the rent of gold ornaments had been allowed as deduction to the assessee and there being no difference in facts pointed out during the year under consideration, I set aside the orders of the lower authorities and vacate the disallowance of Rs. 1,31,180/- under the head "Rent of gold ornaments" and allow this ground of the assessee. 12. In ground no.2 of the appeal, the grievance o....
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....be allowed in entirety. 16. On the other hand, the ld. Departmental Representative supported the orders of the lower authorities. 17. I find that the assessee has claimed the interest on unsecured loan at rates varying from 12 % to 18% and the AO was of the view that the assessee should have paid interest @ 12 % per annum and, accordingly, made the disallowance of excess payment of interest of Rs. 1,71,163/-, which was also confirmed by the ld. CIT(A). I find that even the Income Tax Authorities as per Income-tax Act, 1961, charges interest from the assessee @ 15%. In the given circumstances, the assessee paying interest on unsecured loans at rates varying from 12 % to 18 % cannot be said to be higher side and does not call for any disall....