I.T.O Wd - 6(2),kolkata., Kolkata V. M/s Axix Overseas Ltd, Kolkata

ITA 532/KOL/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1162 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2017
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 05-10-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 13-03-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAURABH KUMAR
• Keywords: Principle of natural justice; Speculation loss; Commercial expediency
• Section: 143(3); 37(1); 37; 154

Judgement Text

, B , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI N.V.VASUDEVAN, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 532 & 376 / KOL / 2013 ASSESSMENT YEAR :2009-10 INCOME TAX OFFICER, WARD- 6(2), P-7, CHOWRINGEE SQUARE, 6TH FLOOR, KOLKATA-69 AXIS OVERSEAS LTD., 21A, SHAKESPEARE SARANI, 3ND FLOOR,KOLKATA-17 [ PAN NO.AAGCA 7497 L ] V/S . V/S . M/S AXIS OVERSEAS LTD., 21, SHAKESPEARE SARANI, KOLKATA-17 INCOME TAX OFFICER, WARD-7(1), P-7, CHOWRINGHEE SQUARE, AAYAKAR BHAVAN, 5TH FLOOR, KOLKATA-69 /APPELLANT .. / RESPONDENT /BY ASSESSEE SHRI SUBASH AGARWAL, ADVOCATE /BY REVENUE SHRI SAURABH KUMAR, ADDL. CIT-DR /DATE OF HEARING 21-08-2017 /DATE OF PRONOUNCEMENT 31-10-2017 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THESE ARE CROSS-APPEAL FILED BY THE REVENUE AS WELL AS ASSESSEE IS DIRECTED AGAINST THE COMMON ORDER OF COMMISSIONER O F INCOME TAX (APPEALS)-VI, KOLKATA DATED 13.12.2012. ASSESSMENT WAS FRAMED BY ITO WARD-6(2), KOLKATA U/S 143(3) OF THE INCOME TAX ACT , 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 29.1 2.2011 FOR ASSESSMENT YEAR 2009-10. 2. SHRI SUBASH AGARWAL, LD. ADVOCATE APPEARED ON B EHALF OF ASSESSEE AND SHRI SAURABH KUMAR, LD. DEPARTMENTAL REPRESENTATIVE APPEARED ON BEHALF OF REVENUE. ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 2 3. BOTH THE APPEALS ARE HEARD TOGETHER AND ARE BEI NG DISPOSED OF BY WAY OF THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIE NCE. FIRST WE TAKE UP ASSESSEES APPEAL IN ITA NO. 376/K OL/2013 . 4. IN THIS APPEAL VARIOUS GROUNDS HAVE BEEN RAISED OUT OF WHICH GROUND NO. 3 TO 8 WERE NOT PRESSED AND THEREFORE SAME ARE DISMISSED AS NOT PRESSED. GROUND NO.9 IS OF GENERAL IN NATURE AND DO ES NOT REQUIRE SEPARATE ADJUDICATION. REMAINING GROUNDS ARE REPRODUCED AS B ELOW:- 1) THAT THE LD. CIT(APPEALS) WERE GROSSLY ERRED IN CONFIRMING THE DISALLOWANCE OF RS.1,60,37,426/- OUT OF INTEREST PA ID RS.1,71,36,916/-. 2) THAT THE LD. ASSESSING OFFICER WAS GROSSLY ERRED IN TREATING LOSS OF RS.70,67,236/- IN FUTURE & OPTIONS AND DERIVATIVE T RANSACTION AS BOGUS LOSS AND LD. CIT(APPEALS) GROSSLY ERRED IN NOT ADJUDICAT ING THE SAID GROUND IN SPITE OF PROPER SUBMISSION MADE BEFORE HIM WITH REGARDS T O SAID DISALLOWANCE. 5. FIRST ISSUE RAISED BY ASSESSEE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN CONFIRMING THE ORDER OF ASSESSING OFFICER BY RESTRI CTING THE DISALLOWANCE OF 1,60,37,426/- OUT OF INTEREST PAID 1,71,36,916/- ON ACCOUNT OF DIVERSION OF FUNDS. 6. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS A LIMI TED COMPANY AND ENGAGED IN TRADING BUSINESS OF RAW JUTE AND DERIVATIVE EXPO RT OF JUTE PRODUCTS. THE ASSESSEE IN ITS BALANCE-SHEET AS ON 31.03.2008 AND 3.103.2009 HAS SHOWN CERTAIN FIGURES OF LOAN, SHARE CAPITAL AND INVESTME NT ETC. AS DETAILED UNDER:- SL.NO. PARTICULARS ON 31.3.08 ON 31.3.09 1 SECURED LOAN 99,65,040 6,83,24,302 2 UNSECURED LOAN 13,81,06,964 2,13,00,000 3 SHARE CAPITAL RESERVE -- 15.12 CRORES 4 INVESTMENT IN FIXED ASSET 1.30 CRORES 1.30 CRO RES 5 INVESTMENT IN SHARES 14.44 CRORES 14.47 CRORES 6 LOAN & ADVANCE --- 10,06,58,478 ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 3 BESIDES THE ABOVE, ASSESSEE HAS CLAIMED AN INTEREST OF 1,71,36,916/- ONLY IN ITS PROFIT AND LOSS ACCOUNT AS DETAILED UNDER:- 1 INTEREST ON BARANAGAR CO-OPERATIVE LOAN RS. 2, 91,478 2 INTEREST ON UN-SECURED LOAN RS. 16,58,262 3 INTEREST ON CAR LOAN RS. 80,558 4 INTEREST ON TDS RS. 6,315 5 INTEREST ON TERM LOAN (SBI) RS. 13,15,661 6 INTEREST ON CC A/C RS. 56,06,714 7 INTEREST ON LC RS. 81,77,928 TOTAL RS.1,71,36,916 THE ASSESSEE, DURING THE COURSE OF ASSESSMENT PROCE EDINGS, SUBMITTED THAT UNSECURED LOAN FOR RS.45 LAKH WAS NOT INTEREST BEAR ING LOAN AND THEREFORE NO EXPENSE FOR INTEREST ON SUCH LOAN WAS CLAIMED IN TH E PROFIT AND LOSS ACCOUNT OF ASSESSEE. 7. THE ASSESSEE ALSO SUBMITTED THAT THE LOAN OF 10,06,58,478/- HAS BEEN GIVEN TO 28 PARTIES WHICH ARE GROUP CONCERN OF IT. THE ASSESSEE ALSO SUBMITTED THAT THE LOAN HAS BEEN GIVEN TO 28 PARTIE S IN THE COURSE OF BUSINESS AS WELL AS ADVANCE HAS BEEN GIVEN FOR THE PURCHASE OF PROPERTY. BUT ASSESSEE FAILED TO FURNISH THE DOCUMENTARY EVIDENCE IN SUPPO RT OF ITS CLAIM DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THUS, AO WAS OF T HE VIEW THAT THE ASSESSEE HAS DIVERTED ITS INTEREST BEARING FUND FOR NON-COMMERCIAL PURPOSE AND THEREFORE THE INTEREST EXPENSE ON SUCH LOAN CAN NOT BE ALLOWED AS DEDUCTION. 7.1 BESIDES THE ABOVE, AO OBSERVED THAT THE AMOUNT OF INTEREST EXPENSE WAS PAID BY ASSESSEE TO M/S PEC LTD. ON ACCOUNT OF INTEREST ON LETTER OF CREDIT (LC FOR SHORT). BUT THE ASSESSEE FAILED TO D EDUCT TAX DEDUCTED AT SOURCE (TDS) U/S. 194A OF THE ACT ON THE AMOUNT OF INTEREST EXPENSE PAID BY IT TO M/S PEC LTD. 7.2 THE ASSESSING OFFICER ALSO FOUND THAT OUT OF IN TEREST EXPENSE OF 81,77,928/- ON ACCOUNT OF INTEREST ON LC TO M/S PE C LTD., A SUM OF ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 4 24,48,531/- REPRESENT THE PRIOR PERIOD EXPENSE. THE REFORE THE SAME (PRIOR PERIOD INTEREST) CANNOT BE ALLOWED AS DEDUCTION DUR ING THE YEAR. ON BEING QUESTION BY THE AO FOR THE NON-DEDUCTION OF TDS, AS SESSEE SUBMITTED THAT IN FACT, THE INTEREST EXPENSE TO M/S PEC LTD. REPRESEN TS THE REIMBURSEMENT OF BANK CHARGES TO M/S PEC LTD. FOR ARRANGING THE LC F ACILITY FROM THE BANK. THEREFORE, THERE WAS NO NEED TO DEDUCT TDS UNDER TH E PROVISION OF SECTION 194A OF THE ACT. HOWEVER, AO DISREGARDED THE CONTEN TION OF THE ASSESSEE AND MADE THE DISALLOWANCE OF THE INTEREST EXPENSE CLAIM ED BY THE ASSESSEE FOR 1,71,36,916/- ON ACCOUNT OF FOLLOWING REASONS. A) DIVERSION OF INTEREST BEARING FUND TO NON-COMMER CIAL ACTIVITY I.E., PROVIDING INTEREST FREE LOAN / ADVANCE TO ITS GROUP CONCERN; B) THE INTEREST EXPENSE OF 81,77,928/- WAS CLAIMED WITHOUT DEDUCTING TDS AS SPECIFIED U/S. 194A OF THE ACT; C) OUT OF TOTAL INTEREST OF 81,77,928/- TO M/S PEC LTD., AN AMOUNT OF 24,48,531/- REPRESENTS THE PRIOR PERIOD EXPENSE. IN VIEW OF ABOVE, AO MADE THE DISALLOWANCE EXPENSE FOR 1,71,36,916/-. 8. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE L D. CIT(A). THE ASSESSEE BEFORE LD. CIT(A) SUBMITTED AS UNDER:- I) PEC LTD. IS WHOLLY OWNED COMPANY BY THE GOVERNME NT OF INDIA AND THEREFORE ANY PAYMENT OF INTEREST TO SUCH COMPANY I S EXEMPTED FROM THE TDS DEDUCTION U/S. 194A OF THE ACT AS PER THE N OTIFICATION NO.S0861(E) DATED 01.06.2007. THEREFORE, ASSESSEE W AS NOT LIABLE TO DEDUCT TDS ON THE PAYMENT OF INTEREST TO M/S PEC LT D. II) BILLS FORM PEC LTD. FOR 24,48,531/- WAS RECEIVED BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION. THEREFORE, THE INTEREST EXPENSE FOR 24,48,531/- WAS RECORDED DURING THE YEAR. THUS, THE ALLEGATION OF THE AO THAT THE IMPUGNED EXPENSE REPRESENTS THE PRIOR P ERIOD ITEMS DOES NOT HOLD GOOD. III) THE AMOUNTS OF LOAN / ADVANCE GIVEN TO 28 PART IES BY THE ASSESSEE ARE ASSOCIATED CONCERNS OF ASSESSEE AND ALL THE AMO UNT WERE GIVEN IN ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 5 THE COURSE OF BUSINESS. THEREFORE, NO DISALLOWANCE OF INTEREST ON ACCOUNT OF DIVERSION OF FUND CAN BE MADE BY THE AO. 9. HOWEVER, LD. CIT(A) AFTER CONSIDERING THE SUBMI SSION OF ASSESSEE HAS PARTLY GRANTED RELIEF TO ASSESSEE BY OBSERVING AS U NDER:- .. DURING THE APPELLATE PROCEEDINGS ON 05.12.2012 , THE APPELLANT SUBMITTED THAT THE INTEREST ON THE AMOUNT OF RS.10, 06,58,478/- MAY TO BE DISALLOWED @ 13.5% ON WHICH RATE THE APPELLANT HAS TAKEN SECURED LOANS FROM THE BANK. THE PLEA OF THE APPELLANT IS ACCEPTE D. THE INTEREST @ 13.5% ON THE AMOUNT OF RS.10,06,58,478/- CALCULATED AT AN AMOUNT OF RS.1,35,88,895/- IS DISALLOWED U/S. 37 OUT OF INTER EST PAID OF RS.1,71,36,916/-. 15. THEREFORE, THE DISALLOWANCE OF AMOUNT OF RS.24, 48,531/- AS RELATING TO PRIOR PERIOD EXPENSES AND AN AMOUNT OF RS.1,35,88,8 95/- AS INTEREST OUT OF THE INTEREST EXPENSES U/S. 37 IS AS INTEREST ON ACC OUNT OF GIVING INTEREST FREE LOANS AND ADVANCES OUT OF THE INTEREST BEARING SECU RED AND UNSECURED LOAN TAKEN BY THE ASSESSEE COMPANY IS DISALLOWED. THEREF ORE, AN AMOUNT OF RS.1,60,37,426/- IS HEREBY DISALLOWED AS DEDUCTION AND HELD TO BE ADDED IN THE INCOME OF THE APE. THIS GROUND OF APPEAL IS PAR TLY ALLOWED. BEING AGGRIEVED BY THIS ORDER OF LD. CIT(A) ASSESSE E CAME IN SECOND APPEAL BEFORE US. 10. LD. AR FOR THE ASSESSEE FILED WRITTEN SUBMISSI ON ALONG WITH PAPER BOOK WHICH IS RUNNING PAGES FROM 1 TO 199 AND FILED THE BREAK-UP OF INTEREST EXPENSE AS DETAILED UNDER:- INTEREST PAYMENTS: RS.1,71,36,916/- (A) DISALLOWANCE CONFIRMED BY CIT(A) (I) INTEREST ATTRIBUTABLE TO INTEREST FREE ADVANCES TO GROUP CONCERNS RS. 1.35.88,895/- (II) INTEREST TO PEC LTD. (PRIOR PERIOD: RS. 24,48,531/- BALANCE RS. 57,29,397/ -) 24,48,531/- RS. 81,77,928/- 1,60,37,426/- (B) DISALLOWANCE OF INTEREST ALLOWED BY CIT(A) RS. (I) INTEREST TO PEC LTD. (RELATING TO RELEVANT PERI OD) 57,29,397/- (II) CAR LOAN 80,558/- (III) INTEREST ON TDS 6,315/- 58,16,270/- A+B 2,18,53,696.00 ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 6 LD. AR SUBMITTED THAT THE LD.CIT(A) ERRED IN WORKIN G OUT THE AMOUNT OF INTEREST EXPENSE WHICH WAS ALLOWED AND DISALLOWED A S DISCUSSED ABOVE. LD. AR FURTHER SUBMITTED THAT THE ASSESSEE HAS NEVER AC CEPTED THE DISALLOWANCE OF INTEREST EXPENSE ON THE 10,06,58,478/- AS WORKED OUT FOR 1,35,88,895/- (13.5% OF 100658478). THE ASSESSEE AGAINST THE FIND ING OF LD. CIT(A) FILED A RECTIFICATION APPLICATION U/S. 154 OF THE ACT WHERE IN LD. CIT(A) HAS ACCEPTED THE FACT THAT ASSESSEE HAS NEVER AGREED FOR THE DIS ALLOWANCE OF INTEREST FOR 1,35,88,895/-. THE RELEVANT EXTRACT OF THE ORDER OF LD. CIT(A) PASSED ORDER U/S 154 OF THE ACT IS REPRODUCED AS BELOW:- 4. THE RATE OF 13.5% HAS BEEN USED AS CALCULATION F OR DETERMINING THE DISALLOWANCE ON MERITS. IT IS HELD THAT THE AUTHORI ZED REPRESENTATIVE HAS NOT ACCEPTED THE DISALLOWANCE OF INTEREST ON INTEREST F REE ADVANCES ON MERITS. IN ACCEPTING THE RATE AND TAKING THE INTEREST @ 13.5%, THE ISSUE OF INTEREST FREE ADVANCES AND CORRESPONDING DISALLOWANCE OF INTEREST U/S. 37 WAS DECIDED ON MERITS AND THERE IS NO MISTAKE APPARENT FROM RECORD TO BE RECTIFIED U/S 154 OF THE INCOME-TAX ACT, 1961. HENCE, THIS PLEA OF THE A PPELLANT IS PARTLY ALLOWED TO THAT EXTENT. LD. AR BEFORE US FURTHER SUBMITTED THAT HE HAS BEEN INSTRUCTED BY THE ASSESSEE NOT TO PRESS THE AMOUNT OF PRIOR PERIOD IN TEREST OF 24,48,531/- PAID TO M/S PEC LTD.. HE FURTHER SUBMITTED THAT ALL LOANS WERE GIVEN IN T HE COURSE OF BUSINESS AND FOR THE PURCHASE OF PROPERTY TO THE GROUP / SISTER CONCERN OF ASSESSEE AND THEREFORE, THE SAME CANNOT BE DISALLOWED. LD. AR FU RTHER SUBMITTED THAT ASSESSEE WAS ALLOTTED SHARES BY SOME OF THE GROUP C OMPANIES AND SOME OTHER COMPANIES RETURNED BACK THE MONEY TO THE ASSE SSEE. LD. AR IN SUPPORT OF ASSESSEES CLAIM DREW OUR ATTENTION ON PAGES 19 AND 83 OF THE PAPER BOOK WHERE THE COPIES OF THE LEDGER WERE PLACED OF THE G ROUP COMPANY SHOWING THE ADJUSTMENT OF THE AMOUNT OF ADVANCE/LOAN. LD. AR IN SUPPORT OF ASSESSEES CLAIM HAS ALSO RELIED ON THE ORDER OF HON'BLE SUPRE ME COURT IN THE CASE OF S.A BUILDERS LTD. VS. CIT AND ANOTHER (2007) 288 ITR 1 (SC), WHEREIN IT WAS HELD AS UNDER:- 35. WE WISH TO MAKE IT CLEAR THAT IT IS NOT OUR OPINIO N THAT IN EVERY CASE INTEREST ON BORROWED LOAN HAS TO BE ALLOWED IF THE ASSESSEE ADVANCES IT TO A SISTER CONCERN. IT ALL DEPENDS ON THE FACTS AND CIR CUMSTANCES OF THE RESPECTIVE ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 7 CASE. FOR INSTANCE, IF THE DIRECTORS OF THE SISTER CONCERN UTILIZE THE AMOUNT ADVANCED TO IT BY THE ASSESSEE FOR THEIR PERSONAL B ENEFIT, OBVIOUSLY IT CANNOT BE SAID THAT SUCH MONEY WAS ADVANCED AS A MEASURE O F COMMERCIAL EXPEDIENCY. HOWEVER, MONEY CAN BE SAID TO BE ADVANC ED TO A SISTER CONCERN FOR COMMERCIAL EXPEDIENCY IN MANY OTHER CIRCUMSTANC ES (WHICH NEED NOT BE ENUMERATED HERE). HOWEVER, WHERE IT IS OBVIOUS THAT A HOLDING COMPANY HAS A DEEP INTEREST IN ITS SUBSIDIARY, AND HENCE IF THE H OLDING COMPANY ADVANCES BORROWED MONEY TO A SUBSIDIARY AND THE SAME IS USED BY THE SUBSIDIARY FOR SOME BUSINESS PURPOSES, THE ASSESSEE WOULD, IN OUR OPINION, ORDINARILY BE ENTITLED TO DEDUCTION OF INTEREST ON ITS BORROWED L OANS. THE LD. AR ALSO RELIED ON THE ORDER OF THIS TRIBUNA L IN THE CASE OF S.P.JASWAL PVT. LTD. VS. ACIT REPORTED IN 140 ITD 19 WHEREIN IT WAS HELD AS UNDER : WHAT IS MATERIAL IS THAT THE ASSESSEE BEING ONE HU NDRED PER CENT HOLDING COMPANY OF 'H' LTD., HAD A DEEP INTEREST IN THE SUB SIDIARY AND THAT THE ADVANCES GIVEN TO THE SUBSIDIARY COMPANY WERE FOR T HE PURPOSES OF BUSINESS. WHEN AN ASSESSEE GIVES AN INTEREST FREE ADVANCE TO A ONE HUNDRED PER CENT OWNED SUBSIDIARY FOR ITS BUSINESS PURPOSES, IT CANN OT BUT ORDINARILY BE SAID TO BE COMMERCIALLY EXPEDIENT. 11. ON THE OTHER HAND, LD. DR HEAVILY RELIED ON TH E ORDER OF AUTHORITIES BELOW AND REQUESTED THE BENCH TO CONFIRM THE SAME. 12. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED AND CAREFULLY CONSIDERED THE MATERIAL ON ACCOUNT OF RECORD; INCLUDING THE JUDICIAL PRONOUNCEMENTS CITED AND PLACED RELIANCE U PON. FROM THE FOREGOING DISCUSSION, WE FIND THAT THE AO MADE THE DISALLOWAN CE OF INTEREST EXPENSE CLAIMED BY ASSESSEE ON ACCOUNT OF THE FOLLOWING REA SONS:- 1) DIVERSION OF INTEREST BEARING LOAN FOR NON-COMM ERCIAL PURPOSE WITHOUT CHARGING ANY INTEREST, 2) INTEREST EXPENSE FOR 81,77,928/- WAS DISALLOWED ON THE GROUND OF NON- DEDUCTION OF TDS; 3) OUT OF INTEREST OF 81,77,928/- A SUM OF 24,38,531/- WAS DISALLOWED ON ACCOUNT OF PRIOR PERIOD ITEM. LD. AR BEFORE US FAIRLY CONCEDED AND AGREED NOT TO AGITATE THE DISALLOWANCE OF 24,48,531/- ON ACCOUNT OF PRIOR PERIOD EXPENSE. OU T OF TOTAL DISALLOWANCE OF INTEREST FOR 1,71,36,916/- HAS ALLOWED THE INTEREST OF 58,16,270/- AS DETAILED UNDER:- ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 8 (B) DISALLOWANCE OF INTEREST ALLOWED BY CIT(A) RS. (I) INTEREST TO PEC LTD. (RELATING TO RELEVANT PERI OD) 57,29,397/- (II) CAR LOAN 80,558/- (III) INTEREST ON TDS 6,315/- 58,16,270/- BESIDES THE ABOVE, LD. AR ALSO AGREED TO DISALLOWAN CE OF 24,48,531/- ON ACCOUNT OF PRIOR PERIOD ITEM. THUS, THE LIMITED IS SUE FOR OUR CONSIDERATION ARISES FOR THE DISALLOWANCE OF INTEREST TO THE TUNE OF 88,72,115/- ONLY (17136916 5816270 2448531). 12.1 NOW THE DISALLOWANCE OF INTEREST HAS TO BE SEE N WHETHER BORROWED FUND HAS BEEN UTILIZED FOR NON-COMMERCIAL PURPOSE WITHOU T CHARGING ANY INTEREST. IN THIS REGARD, THE ARGUMENT PLACED BY LD. AR IS THAT AMOUNT WAS GIVEN TO THE SISTER / GROUP CONCERN AND THEREFORE THE SAME IS AL LOWABLE IN VIEW OF THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF S.A. BUILDERS (SUPRA). HOWEVER, AFTER GOING THROUGH THE RECORDS, WE FIND T HAT LD. AR HAS NOT BROUGHT ANYTHING ON RECORD SUGGESTING THAT THE ADVANCE GIVE N TO THE PARTIES ARE GROUP COMPANIES OF THE ASSESSEE. WE ALSO FIND THAT THE PR INCIPLE LAID DOWN BY HON'BLE SUPREME COURT IN THE CASE OF S.A. BUILDERS (SUPRA) CANNOT BE BLATANTLY FOLLOWED AS HON'BLE SUPREME COURT HAS CLE ARLY OBSERVED AS UNDER:- IT ALL DEPENDS ON THE FACTS AND CIRCUMSTANCES OF TH E RESPECTIVE CASE. FOR INSTANCE, IF THE DIRECTORS OF THE SISTER CONCERN UT ILIZE THE AMOUNT ADVANCED TO IT BY THE ASSESSEE FOR THEIR PERSONAL BENEFIT, OBVI OUSLY IT CANNOT BE SAID THAT SUCH MONEY WAS ADVANCED AS A MEASURE OF COMMERCIAL EXPEDIENCY. HOWEVER, MONEY CAN BE SAID TO BE ADVANCED TO A SIST ER CONCERN FOR COMMERCIAL EXPEDIENCY IN MANY OTHER CIRCUMSTANCES ( WHICH NEED NOT BE ENUMERATED HERE). FROM THE ABOVE PRECEDENT, IT IS CLEAR WHETHER TO TR EAT THE ADVANCE GIVEN TO SISTER CONCERN IN THE COURSE OF ASSESSEES BUSINESS OR NOT, IT ALL DEPENDS UPON THE FACTS AND CIRCUMSTANCE OF EACH CASE. A SPECIFIC QUERY FROM THE BENCH WAS RAISED TO THE LD. AR TO PROVE THAT ALL 28 CONCERNS ARE FALLING IN THE CATEGORY GROUP / SISTER CONCERN. THE LD. AR IN THIS REGARD R EQUESTED THE BENCH TO RESTORE THE MATTER TO THE FILE OF AO FOR FRESH ADJU DICATION IN ACCORDANCE WITH LAW. LD. DR AGREED TO THE SUBMISSION OF THE LD. AR FOR THE ASSESSEE. IN VIEW ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 9 OF THE ABOVE AND IN THE INTEREST OF NATURAL JUSTICE AND FAIR PLAY WE ARE INCLINED TO RESTORE THE ISSUE BACK TO THE FILE OF AO WITH A DIRECTION TO ADJUDICATE THE ISSUE IN THE LIGHT OF ABOVE STATED DISCUSSION AND A CCORDING TO THE PROVISION OF LAW. HENCE, THIS GROUND OF ASSESSEES APPEAL IS ALL OWED FOR STATISTICAL PURPOSE. 13. NEXT ISSUE RAISED BY ASSESSEE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN NOT ADJUDICATING THE GROUND OF APPEAL RAISED BY ASS ESSEE FOR TREATING THE LOSS OF 70,07,236/- AS BOGUS LOSS. 14. AT THE OUTSET, LD. AR FOR THE ASSESSEE BEFORE U S SUBMITTED THAT THE ISSUE OF LOSS IN FUTURE & OPTION AND DERIVATIVE TRA NSACTION WAS RAISED BEFORE LD. CIT(A) BUT HE FAILED TO ADJUDICATE THE SAME. LD . AR FURTHER SUBMITTED THAT AN APPLICATION U/S 154 OF THE ACT WAS PREFERRED BEF ORE LD. CIT(A) AGAINST HIS ORDER DATED 13.12.2012 WHEREIN THE LD. CIT(A) REJEC TED THE CLAIM OF ASSESSEE WITHOUT ADDUCING ANY REASON. IN VIEW OF ABOVE, LD. AR SUBMITTED TO RESTORE THE MATTER BACK TO THE FILE OF LD. CIT(A) FOR FRESH ADJUDICATION. IN REJOINDER LD. DR DOES NOT RAISE ANY OBJECTION IF THE MATTER IS RE MITTED BACK TO THE FILE OF LD. CIT(A). IN VIEW OF THE ABOVE, WE ARE INCLINED TO RE STORE THE MATTER BACK TO THE FILE OF LD. CIT(A) TO ADJUDICATE THE MATTER IN ACCO RDANCE WITH LAW. THIS GROUND OF ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PUR POSE. 15. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLO WED FOR STATISTICAL PURPOSE. COMING TO REVENUES APPEAL IN ITA NO.532/KOL/2013 . 16. GROUNDS RAISED BY REVENUE ARE REPRODUCED BELOW: - LD. CIT(A)-VI, KOL ERRED IN ALLOWING RELIEF TO THE ASSESSEE COMPANY AMOUNT TO RS.162,77,299/- WITHOUT CONSIDERING FACTS OF THE CA SE DUE TO FOLLOWING ISSUES. A) LD. CIT(A)-VI, KOL ERRED IN ALLOWING RELIEF TO T HE ASSESSEE FOR RS.6315/- TOWARDS INTEREST ON TDS ON DELAYED DEPOSIT OF TDS IN CENTRA L GOVT. A/C WITHOUT CONSIDERING THE FACT THAT SAID INTEREST DEBITED IN THE ACCOUNT IS AN INADMISSIBLE ITEM. B) LD. CIT(A)-VI, KOL ERRED IN TREATING LOSS OF RS. 65,33,582/- TOWARDS SHARE TRANSACTION AS BUSINESS LOSS PER PROVISION OF SECTI ON 45(5)(A) AGAINST TREATMENT OF THE SAME BY THE AO AS DEEMED SPECULATION LOSS AS PE R EXPLANATION TO SEC. 73 OF THE IT ACT61 CONSIDERING FACTS OF THE CASE. ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 10 C) LD. CIT(A)-VI, KOL ALSO ERRED IN ALLOWING RELIEF TO THE ASSESSEE FOR RS.104,941/- TOWARDS COMMODITY PROFIT WITHOUT CONSIDERING THE FA CTS THAT AS PER DETAILS FILED TOWARDS NET COMMODITY PROFIT AS ARRIVED AT RS.69,37 ,152/- AGAINST INCOME SHOWN FOR RS.68,58,425/-. D) AN AMOUNT OF RS.14,72,050/- WAS ADDED TO THE TOT AL INCOME OF THE ASSESSEE BEING DIFFERENCE IN ITS DETAILS. LD. CIT(A)-VI, KOL ERRED IN DIRECTING THE AO TO VERIFY THE SAME ON RECEIPT OF A CERTIFICATE TO BE F ILLED BY THE ASSESSEE COMPANY WITHOUT EITHER ALLOWING RELIEF TO THE ASSESSEE COMP ANY OR CONFIRMING THE ADDITION. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, AND CON SIDERING THAT QUANTUM OF REVENUE INVOLVED IN THIS CASE IS HIGHER, IT IS PROP OSED THAT APPEAL TO THE HON'BLE ITAT MAY BE SUGGESTED. 17. FIRST ISSUE RAISED BY REVENUE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN DELETING THE ADDITION MADE BY THE AO FOR 6,315/- ON ACCOUNT OF INTEREST ON THE DELAYED DEPOSIT OF TDS. 18. THE AO DURING THE COURSE OF ASSESSMENT PROCEEDI NGS OBSERVED THAT THE CLAIM OF ASSESSEE FOR INTEREST OF RS.6,315/- ON ACC OUNT OF LATE DEPOSIT OF TDS AMOUNT IS INADMISSIBLE AS PER THE PROVISION OF SEC. 40(A)(II) OF THE ACT. ACCORDINGLY, AO DISALLOWED THE SAME OF 6,315/- AND ADDED TO THE TOTAL INCOME OF ASSESSEE. 19. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A) WHO DELETED THE ADDITION MADE BY AO. THE REVENUE, BEING AGGRIEVED, IS IN APPEAL BEFORE U S. 20. BEFORE US BOTH THE PARTIES RELIED ON THE ORDER OF AUTHORITIES BELOW AS FAVOURABLE TO THEM. 21. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN THE INSTANT CASE, AO HAS DISALLOWED THE INTEREST LEVIED ON ACCOUNT OF LATE DEPOSIT OF TDS U /S 40(A)(II) OF THE ACT. THE AO WAS OF THE VIEW THAT THE INTEREST ON TDS IS NOTH ING BUT INCOME TAX PAID BY THE ASSESSEE ON BEHALF OF PARTIES. HOWEVER, IN OUR CONSIDERED VIEW, THE INTEREST CHARGE WAS LEVIED ON ACCOUNT OF DELAY IN M AKING PAYMENT OF TDS ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 11 WHICH IS COMPENSATORY IN NATURE. AS SUCH, THE INTER EST ON DELAYED PAYMENT IS NOT IN THE NATURE OF PENALTY IN THE GIVEN FACTS AND CIRCUMSTANCE. 22. FURTHER THE PROVISION OF SECTION 40(A)(II) OF THE ACT DENIES FOR THE DEDUCTION OF INCOME-TAX PAID BY THE ASSESSEE BUT IT DOES NOT SPEAK ABOUT THE INTEREST LEVIED ON ACCOUNT OF LATE DEPOSIT OF TDS. IN FACT, THE AMOUNT OF TDS DEDUCTED BY THE ASSESSEE DOES NOT REPRESENT THE INC OME OF THE ASSESSEE RATHER IT REPRESENT THE INCOME FOR THE PARTY IN WHO SE NAME THE TDS WAS DEDUCTED. THUS, IN OUR CONSIDERED VIEW, THE AMOUNT OF INTEREST EXPENSE CANNOT BE DISALLOWED UNDER THE PROVISION OF SECTION 40(A)(II) OF THE ACT. AS SUCH, THE AMOUNT OF INTEREST EXPENSE IS ELIGIBLE FO R DEDUCTION U/S. 37(1) OF THE ACT, AS IT WAS INCURRED IN THE COURSE OF ASSESSEES BUSINESS. IN HOLDING SO, WE DRAW THE PRINCIPLE LAID DOWN BY HON'BLE SUPREME COU RT IN THE CASE OF LACHMANDAS MATHURADAS VS. CIT 254 ITR 799 (SC) WHEREIN IT WAS HELD AS UNDER:- IN TAKING DECISION THE HIGH COURT HAD PLACED RELIAN CE ON ITS FULL BENCH'S DECISION IN SARAYA SUGAR MILLS (P.) LTD. V. CIT [1979] 116 ITR 387 (ALL.) . THE SAID JUDGMENT OF THE FULL BENCH HAD BEEN REVERSED B Y THE LARGER BENCH OF THE HIGH COURT IN TRIVENI ENGG. WORKS LTD. V. CIT [1983] 144 ITR 732/15 TAXMAN 452 (ALL.) (FB) , WHEREIN IT HAD BEEN HELD THAT INTEREST ON ARREARS OF TAX IS COMPENSATORY IN NATURE AND NOT PENAL. THAT QUESTION HAD ALSO BEEN CONSIDERED BY THE SUPREME COURT IN SARAYA SUGAR MILLS (P.) LTD. V. CIT [CIVIL APPEAL NO. 830 OF 1979 DATED 29-2-1996]. IN THAT VI EW OF THE MATTER, THE APPEAL WAS TO BE ALLOWED. IN VIEW OF THE ABOVE, WE FEEL THAT THE ABOVE PRINCI PLE LAID DOWN BY HON'BLE SUPREME COURT CAN BE APPLIED TO THE INTEREST EXPENS E LEVIED ON ACCOUNT OF DELAYED PAYMENT OF TDS AS IT RELATES TO THE EXPENSE S CLAIMED BY ASSESSEE WHICH ARE SUBJECT TO THE PROVISION OF TDS. THE ASSE SSEES ARGUMENT IS THAT IT CLAIMS THE EXPENSE OF CERTAIN AMOUNT IN ITS PROFIT AND LOSS ACCOUNT AND OUT OF SUCH EXPENSE IT DEDUCTS CERTAIN PERCENTAGE AS SPECI FIED UNDER THE ACT AS TDS WHICH IS PAID TO THE GOVERNMENT EXCHEQUER ON BEHALF OF THE PARTY. THUS, THE AMOUNT OF TDS REPRESENTS THE AMOUNT OF INCOME TAX O F THE PARTY ON WHOSE BEHALF THE PAYMENT WAS DEDUCTED AND PAID TO THE GOV ERNMENT EXCHEQUER AND ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 12 NOT THE INCOME OF THE ASSESSEE. IN VIEW OF THE ABOV E, WE CONCLUDE THAT THE INTEREST EXPENSES CLAIMED BY ASSESSEE ON ACCOUNT OF DELAYED DEPOSIT OF TDS ARE ALLOWABLE EXPENSE U/S. 37(1) OF THE ACT. IN THI S VIEW OF THE MATTER WE FIND NO REASON TO INTERFERE IN THE ORDER OF LD. CIT(A). WE UPHOLD THE SAME. THIS GROUND OF REVENUE IS DISMISSED. 23. NEXT ISSUE RAISED BY REVENUE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN TREATING THE LOSS OF 65,33,582/- AS NON SPECULATIVE AS PER THE EXPLANATI ON TO SECTION 73 OF THE ACT. 24. THE ASSESSEE IN THE YEAR UNDER CONSIDERATION HA S CLAIMED LOSS OF 65,33,582/- ON ACCOUNT OF SHARE TRADING ACTIVITY. THE AO TREATED THE SAME AMOUNT OF LOSS AS SPECULATION IN NATURE AS PER THE EXPLANATION TO SECTION 73 OF THE ACT. ACCORDINGLY, AO DID NOT ALLOW THE SET O FF IMPUGNED LOSS FROM THE BUSINESS OF THE ASSESSEE. 25. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A). THE ASSESSEE SUBMITTED BEFORE LD. CIT(A) THAT THE IMPUG NED LOSS WAS ALREADY TREATED BY IT AS SPECULATIVE IN NATURE WHICH WAS CL AIMED TO BE SET OFF AGAINST THE SPECULATIVE INCOME ONLY. LD. CIT(A) AFTER CONSI DERING THE SUBMISSION OF ASSESSEE DELETED THE ADDITION MADE BY AO BY OBSERVI NG AS UNDER:- 21. THE APPELLANT SUBMITTED THAT IT HAD NOT DONE AN Y HEDGING. THE TRANSACTIONS WERE NOT IN THE NATURE TO GUARD AGAINS T ANY LOSS OF FUTURE FLUCTUATION IN PRICE FOR SALE/PURCHASE. THUS THE CO MMODITY PROFIT SHOULD BE TREATED AS SPECULATIVE PROFIT AS CLAIMED BY THE ASS ESSEE AND ALLOWED SET OFF AGAINST THE SHARE TRADING BUSINESS WHICH HAS BEEN H ELD BY THE ASSESSING OFFICER AS SPECULATION BUSINESS. IN THE FACTS AND C IRCUMSTANCES IT IS HELD THAT THE APPELLANT HAS DONE COMMODITY TRADING IN JUTE WH ICH IS THE LINE OF THE BUSINESS OF THE APPELLANT BUT THE TRANSACTIONS HAVE BEEN DONE WITHOUT TAKING DELIVERY AND THE GAIN IS A SPECULATION GAIN. THE AP PELLANT HAS SHOWN THE PROFIT FROM THE SAME AS SPECULATIVE PROFIT IN THE PROFIT & LOSS ACCOUNT. THE ASSESSING OFFICER HAS ALREADY HELD THE SHARE LOSS A MOUNTING TO RS.65,33,582/- AS SPECULATION LOSS AS PER EXPLANATI ON TO SECTION 73 OF THE INCOME TAX ACT, 196. THEREFORE, THE SET OFF OF SPEC ULATION PROFIT WITH THE SPECULATION GAIN IS ALLOWED. HENCE, IT IS HELD THAT BOTH THE GAIN FROM COMMODITY TRADING AND LOSS FROM SHARE TRADING ARE S PECULATIVE IN NATURE AND ARE TO BE SET OFF AGAINST EACH OTHER. THE ASSESSING OFFICER IS DIRECTED TO ALLOW ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 13 THESE OFF OF GAIN FROM JUTE WITH THE LOSS FROM SHAR E TRADING. THESE GROUNDS ARE ACCORDINGLY ALLOWED. THE REVENUE, BEING AGGRIEVED, IS IN APPEAL BEFORE U S. 26. BEFORE US BOTH PARTIES RELIED ON THE ORDER OF A UTHORITIES BELOW AS FAVOURABLE TO THEM. 27. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. AT THE OUTSET, IT WAS OBSERVED THAT ASSESSEE CLAIMED THE LOSS OF 65,73,582/- AS SPECULATIVE IN NATURE AS PER EXPLANA TION TO SECTION 73 OF THE ACT. THUS, SUCH LOSS WAS SET OFF AGAINST THE SPECULATIVE INCOME BY THE ASSESSEE. IN VIEW OF THIS, WE FIND TH AT THE AO HAS ALREADY TREATED THE IMPUGNED LOSS AS SPECULATIVE IN NATURE AND THE SAME IS ALSO CLAIMED BY ASSESSEE AS SPECULATIVE IN NATURE. THERE FORE, WE FIND NO INFIRMITY IN THE ORDER OF LD. CIT(A). WE UPHOLD THE SAME. THI S GROUND OF REVENUES APPEAL IS DISMISSED. 28. NEXT ISSUE RAISED BY REVENUE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN DELETING THE ADDITION MADE BY AO FOR 1,04,941/- ON ACCOUNT OF UNDISCLOSED INCOME OF ASSESSEE. 29. AT THE OUTSET, LD. AR FAIRLY CONCEDED THAT ASSE SSEE HAS SHOWN LESS INCOME IN ITS RETURN FILED AT 1,04,941/- ONLY. ACCORDINGLY, LD. AR REQUESTED THE BENCH TO SUSTAIN THE ADDITION AS MADE BY AO. 30. IN VIEW OF THE ABOVE PROPOSITION, WE REVERSE TH E ORDER OF LD. CIT(A) AND CONFIRM THE ORDER OF AO. HENCE, THIS GROUND OF REVE NUES APPEAL IS ALLOWED. 31. NEXT ISSUE RAISED BY REVENUE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN DIRECTING THE AO TO VERIFY THE UNDISCLOSED INVESTME NT OF 14,72,050/- AND ADJUDICATE THE MATTER ACCORDINGLY. THE ASSESSEE DUR ING THE YEAR HAS MADE TRANSACTIONS WITH THE BSE LTD. FOR 14,72,050/- WHICH IT FAILED TO EXPLAIN FROM ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 14 THE BOOKS OF ACCOUNT TO THE AO. THEREFORE THE SAME WAS TREATED AS UNDISCLOSED INVESTMENT BY THE AO AND ACCORDINGLY IT WAS ADDED TO THE TOTAL INCOME OF ASSESSEE. 32. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A). THE ASSESSEE SUBMITTED BEFORE LD. CIT(A) THAT TRANSACTI ONS WITH THE BSE LTD. IS DULY RECORDED IN THE BOOKS OF ACCOUNT. THE ASSESSEE IN SUPPORT OF ITS CLAIM PRODUCED THE COPY OF CONTRACT NOTE DATED 12.08.2008 RECEIVED FROM M/S BALJIT SECURITIES PVT. LTD. LD. CIT(A) AFTER CONSIDERING T HE SUBMISSION OF ASSESSEE DIRECTED THE AO TO VERIFY THE NECESSARY DETAILS FRO M THE BOOKS OF ACCOUNT OF ASSESSEE AND ACCORDINGLY ADJUDICATE THE ISSUE BY OB SERVING AS UNDER:- 24. I HAVE CAREFULLY CONSIDERED THE OBSERVATIONS O F THE ASSESSING OFFICER IN THE ASSESSMENT ORDER, AND SUBMISSIONS OF THE APPELLANT. THE APPELLANT IS DIRECTED TO GIVE A CERTIFICATE BASED U PON HIS BOOKS OF ACCOUNT THAT SUCH DEALINGS HAVE BEEN ENTERED BY THE APPELLANT WITH THOSE PARTIES WHOSE RECEIPT IS BEING ASKED BY THE A SSESSING OFFICER. ON RECEIPT OF SUCH A CERTIFICATE SHOWING SUCH DEALINGS EXPRESSLY BY THE APPELLANT, THE ASSESSING OFFICER WILL VERIFY SUCH I NFORMATION. THE APPELLANT HAS FILED THE COPY OF THE CONTRACT NOTE R ECEIVED FROM BALAJIT SECURITIES PVT LTD IN WHICH BOTH AMOUNTS ARE REFLEC TED TOTALING TO RS.14,72,050/-. THIS GROUND OF APPEAL IS ACCORDINGL Y CONSIDERED TO BE ALLOWED FOR STATISTICAL PURPOSES. THE REVENUE, BEING AGGRIEVED, IS IN APPEAL BEFORE U S. 33. BEFORE US BOTH THE PARTIES RELIED ON THE ORDER OF AUTHORITIES BELOW AS FAVOURABLE TO THEM. 34. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN THE INSTANT CASE, THE ADDITION MADE BY ASSESSING OFFICER ON THE GROUND THAT ASSESSEE FAILE D TO EXPLAIN THE TRANSACTIONS OF 14,72,050/- FROM THE BOOKS OF ACCOUNT. HOWEVER, LD. CIT(A) HAS RESTORED THE MATTER BACK TO THE FILE OF AO WITH A DIRECTION TO VERIFY THE NECESSARY DETAILS FROM THE BOOKS OF ACCOUNT OF ASSE SSEE. FROM THE ABOVE PROPOSITION, WE FIND THAT NECESSARY DETAILS WERE SU BMITTED BY ASSESSEE BEFORE ITA NO.532 & 376/KOL/2013 A.Y. 2009-10 ITO WD. 6(2) KOL. VS. M/S AXIS OVERSEAS LTD. PAGE 15 APPELLATE STAGE TO PROVE THE GENUINENESS OF THE TRA NSACTIONS AS DISCUSSED ABOVE. LD. CIT(A) HAS ACCORDINGLY DIRECTED THE ASSE SSING OFFICER TO VERIFY THE SAME AND ADJUDICATE THE MATTER. WE FIND THAT THE MA TTER WAS NOT SET ASIDE TO AO BLANKET BY THE LD. CIT(A). IN SUCH DIRECTION, W E DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD. CIT(A). WE UPHOLD THE SAME. HENCE, THIS GROUND OF REVENUES APPEAL IS DISMISSED. 35. IN THE RESULT, REVENUES APPEAL IS PARTLY ALLOW ED. 36. IN COMBINE RESULT, ASSESSEES APPEAL IS ALLOWED PAR TLY FOR STATISTICAL PURPOSE AND THAT OF REVENUE IS ALSO PAR TLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 31/ 10/2017 SD/- SD/- (' ) ( ) (N.V.VASUDEVAN) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP, SR.P.S )- 31 / 10 /201 7 / COPY OF ORDER FORWARDED TO:- 1. /ASSESSEE-M/S AXIS OVERSEAS LTD., 21, SHAKESPEARE S ARANI, KOLKATA-17 2. /REVENUE-ITO, WARD-6(2), P-7, CHOWRINGHEE SQUARE, 6 TH FL, KOLKATA-69 3. 4 5 / CONCERNED CIT KOLKATA 4. 5- / CIT (A) KOLKATA 5. 8 ''4, 4, / DR, ITAT, KOLKATA 6. = / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO 4,