2008 (6) TMI 209

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.... JUDGMENT   The judgment of the court was delivered by C. N. RAMACHANDRAN NAIR J.—Heard standing counsel for the appellant and the counsel appearing for the respondent-assessee. 2. Two issues are raised in the appeal filed by the Revenue. The first question pertains to the bogus purchases accounted by the a as excess driage for the copra purchased and crushed in the assessee'....

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....essee. In the appeal filed against the regular assessment in the hands of the sister concern M/s. Sree Rajvel and Company, the Tribunal has set aside and remanded the assessment on this issue. However, in the case of assessee where the addition is only protective assessment, the Tribunal declined to remand the matter, but confirmed the order of the Commissioner of Income-tax (Appeals) in deleting ....

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....disallowance of proportionate interest on the sum advanced by the assessee to the partners as interest-free loans. The assessee had a fixed deposit receipt of Rs.10 lakhs with the bank which matured on November 30, 1990. The assessee, which substantially depends on borrowed funds for running the business instead of utilizing the funds for business purposes, allowed the partners to take 5 lakhs rup....

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....l for the Revenue referred to the decision of this court reported in CIT v. V. I. Baby and Co. [2002] 254 ITR 248 and in CIT v. Abhishek Industries Ltd. [2006] 286 ITR 1 (P & H). The counsel for the assessee relied on the finding of the authorities below about the availability of the reserves and surplus in their favour and supported the order of the Tribunal. We feel the facts of the case are ver....