Ankur Scientific Technologies Private Limited, Vadodara V. The Deputy Commissioner of Income Tax, Circle-1(1)(1), Vadodara

ITA 645/AHD/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5130 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2013-2014
• Appeal Filed On: 15-03-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B P SRIVASTAVA
• Assessee Lawyers: SURENDRA MODIYANI
• Keywords: Earning of tax free income; Proportionate interest
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ./ITA NO. 645/AHD/2017 ( / ASSESSMENT YEAR : 2013-14) ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. ANKUR NR. NAVRACHNA SCHOOL SAMA, VARODA 390 024 / VS. THE DCIT CIRCLE-1(1)(1) BARODA ./ ./ PAN/GIR NO. : AABCA 7801 R ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI SURENDRA MODIYANI, AR / RESPONDENT BY : SHRI B.P. SRIVASTAVA, SR.DR / DATE OF HEARING 07/01/2019 !'# / DATE OF PRONOUNCEMENT 01 /02/2019 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME TAX (APPEALS)1, VADODARA [CIT(A) IN SHORT] VIDE APPEAL NO.CAB- 1/367/2015-16 DATED 06.01.2017 ARISING IN THE ASS ESSMENT ORDER PASSED UNDER S.143(3) OF THE INCOME TAX ACT, 1961(HEREINA FTER REFERRED TO AS 'THE ACT') DATED 31/12/2015 RELEVANT TO ASSESSMEN T YEAR (AY) 2013- 14. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- THE ORDER OF THE LEARNED COMMISSIONER (APPEALS) IS AGAINST LAW AND FACTS. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 2 - 1. THE LEARNED COMMISSIONER (APPEALS) ERRED IN CONFIR MING DISALLOWANCE MADE BY THE ASSESSING OFFICER UNDER SE CTION 14A AMOUNTING TO RS.7,32,684/- IN ADDITION TO RS.66,810 /- ALREADY MADE IN THE RETURN OF INCOME BY THE APPELLANT. YOUR APPELLANT SUBMITS THAT THE DISALLOWANCE IS NOT JUSTIFIED AND PRAYS THAT THE SAME BE DELETED. 2. THE LEARNED COMMISSIONER (APPEALS) ERRED IN CONFIR MING ADDITION OF RS.16,20,000/- ON ACCOUNT OF INTEREST F REE LOAN GRANTED BY THE APPELLANT. 3. THE LEARNED COMMISSIONER (APPEALS) ERRED IN DISMIS SING THE APPEAL RELATING TO CREDIT NOT GIVEN FOR TAX DEDUCTE D AT SOURCE FOR RS.1,32,197/-. YOUR APPELLANT SUBMITS THAT THE DISALLOWANCE OF TAX CREDIT FOR TAX DEDUCTED IS NOT JUSTIFIED AND PRAYS THAT CREDIT BE ALLOWED FOR RS.4,06,861/- AS AGAINST THE TAX CREDIT ALLOWED TO THE EXTENT OF RS.2,74,664/- ONLY. 4. THE LEARNED COMMISSIONER (APPEALS) ERRED IN DISMISS ING THE APPEAL RELATING TO CREDIT NOT GIVEN FOR THE ADVANCE TAX PAID OF RS.15,00,000/-. YOUR APPELLANT SUBMITS THAT THE DISALLOWANCE OF TAX CREDIT FOR ADVANCE TAX PAID IS NOT JUSTIFIED AND PRAYS THAT CR EDIT BE ALLOWED FOR RS.2,61,41,977/- AS AGAINST THE TAX CRE DIT ALLOWED TO THE EXTENT OF RS.2,46,41,977/- ONLY. 3. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT HE HAD BEEN INSTRUCTED BY THE ASSESSEE NOT TO PRESS TH E GROUND NOS. 3 & 4 OF THIS APPEAL. THEREFORE, WE DISMISS THE SAME AS NOT PRESSED. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 3 - 4. THE FIRST ISSUE RAISED IN GROUND NO. 1 IS THAT T HE LD.CIT (A) ERRED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OF FICER (AO) FOR RS. 7,32,684/- U/S 14A OF THE ACT. 5. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGED IN THE BUSINESS OF MANUFACTURING OF BIO-MASS GASIFIERS AND BIOMASS POWER GENERATION. THE ASSESSEE DURING THE YEAR HAS EARNED DIVIDEND INCOME OF RS. 20,31,461/- WHICH WAS CLAIME D AS EXEMPT U/S 10(34)/10(35) OF THE ACT. 5.1. THE ASSESSEE AGAINST SUCH INCOME HAS MADE THE DISALLOWANCE U/S 14A OF THE ACT, TOWARDS DIRECT EXPENSES AND ADMINIS TRATIVE EXPENSES AMOUNTING TO RS. 16,241/- AND RS. 50,569/- RESPECTI VELY AGGREGATING TO RS. 66,810/- ONLY. 5.2. HOWEVER, THE AO FOUND THAT THE ASSESSEE HAS CL AIMED INTEREST EXPENSES AMOUNTING TO RS. 51,76,488/- BUT THERE WAS NO DISALLOWANCE OF SUCH INTEREST EXPENSES U/S 14A OF THE ACT. 5.3. THE AO ALSO NOTICED THAT THE ASSESSEE HAS NOT CONSIDERED THE OTHER EXPENSES, UTILIZATION OF ASSETS FOR MAKING THE DISA LLOWANCE OF ADMINISTRATIVE EXPENSES. ACCORDINGLY, THE ASSESSING OFFICER INVOKED THE PROVISIONS OF SECTION 14A R.W. RULE 8D OF THE INCOM E TAX RULES, 1962 AND MADE THE DISALLOWANCE AS UNDER: ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 4 - SL.NO.(S) PARTICULARS AMOUNT (IN RS.) 1. DIRECT EXPENSES 16,241/- 2. INTEREST EXPENSES 4,91,980/- 3. ADMINISTRATIVE EXPENSES 2,24,463/- TOTAL 7,32,684/- 5.4. ACCORDINGLY, THE ASSESSING OFFICER DISALLOW ED THE ABOVE EXPENSES AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 6. AGGRIEVED ASSESSEE PREFERRED AN APPEAL BEFOR E THE LD.CIT (A). 7. THE ASSESSEE BEFORE THE LD.CIT (A) SUBMITTED THA T ITS OWN FUND EXCEEDS THE AMOUNT OF INVESTMENT. THEREFORE, THERE CANNOT BE ANY DISALLOWANCE OF INTEREST EXPENSES. 7.1. REGARDING ADMINISTRATIVE EXPENSES, THE ASSESSE E SUBMITTED THAT THE INVESTMENTS WHICH HAVE GENERATED EXEMPTED INCOME SH OULD ONLY BE CONSIDERED FOR DISALLOWANCE. ACCORDINGLY, THE DISAL LOWANCE IS COMING FOR RS. 2,302/- AS COMPARED TO RS. 50,569/- WHICH HAS A LREADY BEEN DISALLOWED IN THE INCOME-TAX RETURN. 7.2 HOWEVER, THE LD.CIT (A) OBSERVED THAT THE ASS ESSEE HAD NOT FURNISHED ANY FUND FLOW STATEMENT JUSTIFYING THAT T HE INVESTMENT WAS MADE OUT OF ITS INTEREST-FREE FUND. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 5 - 7.2. THE PRINCIPLES LAID DOWN BY THE HONBLE GUJARA T HIGH COURT IN THE CASE OF CIT VS. CORRETECH ENERGY PVT.LTD. REPORTED IN 45 TAXMANN.COM 116 ARE NOT APPLICABLE TO THE FACTS OF THE INSTANT CASE. IT IS BECAUSE IN THAT CASE THERE WAS NO DIVIDEND INCOME EARNED BY THE ASS ESSEE WHEREAS THE ASSESSEE IN THE INSTANT CASE HAS EARNED DIVIDEND IN COME. 7.3. IN VIEW OF THE ABOVE, THE LD.CIT (A) CONFIRMED THE ORDER OF THE AO. 8. BEING AGGRIEVED BY THE ORDER OF THE LD.CIT (A), THE ASSESSEE IS IN APPEAL BEFORE US. 9. THE LD.AR BEFORE US FILED A PAPER-BOOK RUNNING F ROM PAGE NOS.1 TO 22 AND SUBMITTED THAT ITS FUNDS EXCEED THE AMOUN T OF INVESTMENT. THEREFORE THERE CANNOT BE ANY DISALLOWANCE OF INTER EST EXPENSES. 9.1. THE LD.AR ALSO SUBMITTED THAT THE DISALLOWANC E CONCERNING TO ADMINISTRATIVE EXPENSES SHOULD BE WORKED OUT ON THE BASIS OF THE INVESTMENTS WHICH HAVE YIELDED DIVIDEND INCOME IN T HE YEAR UNDER CONSIDERATION. 10. ON THE OTHER HAND, THE LD. DR SUBMITTED THAT TH E FUND OF THE ASSESSEE HAS ALREADY BEEN INVESTED/BLOCKED WITH THE FIXED ASSETS. THEREFORE, IN THE ABSENCE OF FUND FLOW STATEMENT, I T CANNOT BE ASCERTAINED THAT THE INVESTMENT WAS MADE OUT OF THE OWN INTERES T-FREE FUND. THE LD. DR VEHEMENTLY SUPPORTED THE ORDERS OF THE AUTHORITI ES BELOW. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 6 - 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERU SED THE MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE, THE ISSUE INVOLVES FOR THE DISALLOWANCE OF THE EXPENSES UNDER SECTION 14A R.W. RULE 8D OF THE INCOME TAX RULES FOR THE AMOUNT AS DETAILED UNDER: I. INTEREST EXPENSES RS. 4,91,980.00 II. ADMINISTRATIVE EXPENSES RS. 2,24,463.00 11.1. REGARDING THE DISALLOWANCE OF INTEREST EXPE NSES, WE NOTE THAT THE INTEREST FREE FUND AVAILABLE WITH THE ASSESSEE EXCE EDS THE VALUE OF INVESTMENTS. THIS FACT CAN BE VERIFIED FROM THE BAL ANCE SHEET FILED BY THE ASSESSEE, WHICH IS PLACED ON RECORD. THEREFORE, A P RESUMPTION CAN BE DRAWN THAT THE INVESTMENT WAS MADE BY THE ASSESSEE OUT OF ITS OWN FUND AVAILABLE WITH IT. IN THIS REGARD WE FIND SUPPORT A ND GUIDANCE FROM THE JUDGEMENT OF HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS.UTI BANK LTD. REPORTED IN 32 TAXMANN.COM 370 WHEREIN IT WAS HELD NO DISALLOWANCE OF INTEREST EXPENSES IS WARRANTED IF T HE OWN FUND OF THE ASSESSEE EXCEEDS THE AMOUNT OF INVESTMENT. 11.2. REGARDING THE ADMINISTRATIVE EXPENSES, THE ONLY ARGUMENT OF THE ASSESSEE IS THAT THE DISALLOWANCE UNDER RULE 8D SHO ULD BE MADE AFTER CONSIDERING THE INVESTMENT WHICH HAVE YIELDED EXEMP T INCOME DURING THE YEAR. WE FIND FORCE IN THE ARGUMENT OF THE LD. COUN SEL FOR THE ASSESSEE. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 7 - 11.3. IN HOLDING SO, WE DRAW THE PRINCIPLES LAID DOWN BY THE HONBLE DELHI HIGH COURT IN THE CASE OF PCIT VS. IL & FS EN ERGY DEVELOPMENT COMPANY LTD. REPORTED IN 84 TAXMAN.COM 186 WHEREIN IT WAS HELD AS UNDER: THE WORDS 'IN RELATION TO INCOME WHICH DOES NOT FO RM PART OF THE TOTAL INCOME UNDER THE ACT FOR SUCH PREVIOUS YEAR' IN THE RULE 8D(1) INDICATES A CORRELATION BETWEEN THE EXEMPT IN COME EARNED IN THE ASSESSMENT YEAR AND THE EXPENDITURE INCURRED TO EARN IT. IN OTHER WORDS, THE EXPENDITURE AS CLAIMED BY THE ASSE SSEE HAS TO BE IN RELATION TO THE INCOME EARNED IN 'SUCH PREVIOUS YEAR'. THIS IMPLIES THAT IF THERE IS NO EXEMPT INCOME EARNED IN THE ASSESSMENT YEAR IN QUESTION, THE QUESTION OF DISALLOWANCE OF T HE EXPENDITURE INCURRED TO EARN EXEMPT INCOME IN TERMS OF SECTION 14A READ WITH RULE 8D WOULD NOT ARISE. THE CBDT CIRCULAR UPON WHICH EXTENSIVE RELIANCE IS PLACED BY REVENUE DOES NOT REFER TO RULE 8D(1) AT ALL BUT ONL Y REFERS TO THE WORD 'INCLUDIBLE' OCCURRING IN THE TITLE TO RULE 8D AS WELL AS THE TITLE TO SECTION 14A. THE CIRCULAR CONCLUDES THAT I T IS NOT NECESSARY THAT EXEMPT INCOME SHOULD NECESSARILY BE INCLUDED I N A PARTICULAR YEAR'S INCOME FOR THE DISALLOWANCE TO BE TRIGGERED. THIS WILL BE A TRUNCATED READING OF SECTION 14A AND RULE 8D PARTICULARLY WHEN RULE 8D(1) USES THE EXPRESSION 'S UCH PREVIOUS YEAR'. FURTHER, IT DOES NOT ACCOUNT FOR THE CONCEPT OF 'REAL INCOME'. IT DOES NOT NOTE THAT UNDER SECTION 5, THE QUESTION OF TAXATION OF 'NOTIONAL INCOME' DOES NOT ARISE. 11.4. WE ALSO FIND SUPPORT & GUIDANCE FROM THE JU DGMENT OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. C ORRTECH ENERGY PRIVATE LTD REPORTED IN 45 TAXMANN.COM 116, WHEREIN IT WAS HELD AS UNDER: SECTION 14A(1) PROVIDES THAT FOR THE PURPOSE OF CO MPUTING TOTAL INCOME UNDER CHAPTER IV, NO DEDUCTION SHALL BE ALLO WED IN RESPECT ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 8 - OF EXPENDITURE INCURRED BY THE ASSESSEE IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE ACT. IN THE INSTANT CASE, THE TRIBUNAL HAS RECORDED THE FINDING OF FACT THAT THE ASSESSEE DID NOT MAKE ANY CLAIM FOR EXEMPTION OF AN Y INCOME FROM PAYMENT OF TAX. IT WAS ON THIS BASIS THAT THE TRIBU NAL HELD THAT DISALLOWANCE UNDER SECTION 14A COULD NOT BE MADE. I N THE PROCESS TRIBUNAL RELIED ON THE DECISION OF DIVISION BENCH O F PUNJAB AND HARYANA HIGH COURT IN CASE OF CIT V. WINSOME TEXTIL E INDUSTRIES LTD. [2009] 319 ITR 204 IN WHICH ALSO THE COURT HAD OBSERVED THAT WHERE THE ASSESSEE DID NOT MAKE ANY CLAIM FOR EXEMP TION, SECTION 14A COULD HAVE NO APPLICATION. 11.5. IN THE ABOVE CASE, WE NOTE THAT THERE WAS N O DIVIDEND INCOME RECEIVED BY THE ASSESSEE DURING THE YEAR UNDER CONS IDERATION. THEREFORE, THE HONBLE JURISDICTIONAL HIGH COURT DIRECTED NOT TO MAKE ANY DISALLOWANCE OF THE EXPENSES UNDER SECTION 14A READ W. RULE 8D IN THE ABSENCE OF ANY DIVIDEND INCOME. 11.6. THE FORMULA SPECIFIED UNDER RULE 8D FOR DISAL LOWANCE REQUIRES TO TAKE ONLY THOSE INVESTMENTS WHICH HAVE YIELDED DIVI DEND INCOME. AS IN THE ABOVE CASE, THERE WAS NO DIVIDEND INCOME, THERE FORE THERE CANNOT BE ANY QUESTION OF MAKING ANY DISALLOWANCE UNDER THE P ROVISIONS OF SECTION 14A R.W RULE 8D OF INCOME TAX RULE. 11.7. ACCORDINGLY, WE NOTE THAT THE SAME PRINCIPL ES CAN BE APPLIED TO THE CASE ON HAND. THUS WE DIRECT THE AO TO TAKE ONL Y THOSE INVESTMENTS FOR DISALLOWANCE UNDER SECTION 14A READ WITH RULE 8 D WHICH HAVE YIELDED DIVIDEND INCOME DURING THE YEAR. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 9 - 11.8. HOWEVER, THE DISALLOWANCE ON ACCOUNT OF ADM INISTRATIVE EXPENSES CANNOT REDUCE BELOW THE AMOUNT OFFERED BY THE ASSES SEE UNDER SECTION 14A R.W RULE 8D OF INCOME TAX RULES. 11.9. WE HOLD ACCORDINGLY. HENCE, THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED IN TERMS OF THE ABOVE. 12. THE NEXT ISSUE IS RAISED IN GROUND NO.2 IS THAT THE LD. CIT(A) IN CONFIRMING THE ADDITION OF RS.16,20,000/- ON ACCOUN T OF DIVERSION OF AN INTEREST-BEARING LOAN. THE ASSESSEE HAS SHOWN AN IN VESTMENT OF RS. 135 LACS IN THE BALANCE SHEET AS ON 01/04/2012. BUT TH ERE WAS NO SUCH INVESTMENT IN THE BALANCE-SHEET AS ON 31/03/2013. 12.1. THE ASSESSEE SUBMITTED THAT IT HAD MADE AN AD VANCE OF RS.135 LACS FOR THE PURCHASE OF IMMOVABLE PROPERTY TO M/S.VASTU SHILP INFRASTRUCTURE PVT.LTD. IN THE EARLIER YEARS. BUT THE DEAL WAS NO T MATERIALIZED AND ACCORDINGLY, THE MONEY WAS RECEIVED BACK BY IT. 12.2. HOWEVER, THE ASSESSING OFFICER ON CONFIRMATIO N FROM VASTU SHILP INFRASTRUCTURE PVT.LTD. (VIPL) NOTICED THAT IT WAS CLASSIFIED AS UNSECURED LOAN IN THE BOOKS OF VASTU SHILP INFRASTRUCTURE PVT .LTD. THEREFORE, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE ASSESSEE HAS DIVERTED ITS INTEREST-BEARING FUND TO NON-INTEREST ADVANCES. ACCORDINGLY, THE AO WORKED OUT THE PROPORTIONATE INTEREST ON RS. 135 LA CS AMOUNTING TO RS. 16,20,000/- AND ADDED BACK TO THE TOTAL INCOME OF T HE ASSESSEE. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 10 - 13. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE L D.CIT (A). THE ASSESSEE BEFORE THE LD.CIT (A) AMONG OTHERS SUBMITT ED THAT IT HAS ADVANCED MONEY FOR THE INVESTMENT IN THE IMMOVABLE PROPERTY OUT OF INTEREST-FREE FUND AVAILABLE WITH IT. THEREFORE, T HERE CANNOT BE ANY DISALLOWANCE OF INTEREST EXPENSES. 13.1. HOWEVER, THE LD.CIT (A) DISREGARDED THE CONTE NTION OF THE ASSESSEE BY OBSERVING THAT THERE WAS NO FUND FLOW F ILED BY THE ASSESSEE EVIDENCING THAT THE FUND IN THE PROPERTY WAS INVEST ED OUT OF ITS INTEREST- FREE FUND. ACCORDINGLY, THE LD.CIT (A) CONFIRMED THE ORDER OF THE AO. 14. BEING AGGRIEVED BY THE ORDER OF THE LD.CIT (A), NOW THE ASSESSEE IS IN APPEAL BEFORE US. 15. THE LD.AR BEFORE US REITERATED THE SUBMISSIONS AS WERE MADE BEFORE THE LD.CIT (A), WHEREAS THE LD. DR VEHEMENTL Y SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 16. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERU SED THE MATERIALS AVAILABLE ON RECORD. IT IS UNDISPUTED FACT THAT THE ASSESSEE HAS OWN FUND EXCEEDING THE AMOUNT OF ADVANCES GIVEN FOR THE PART Y AS DISCUSSED ABOVE. THUS A PRESUMPTION CAN BE DRAWN THAT THE FUND WAS A DVANCED BY THE ASSESSEE WITHOUT CHARGING ANY INTEREST OUT OF ITS O WN INTEREST FREE FUND AVAILABLE WITH IT. IN THIS REGARD WE FIND SUPPORT A ND GUIDANCE FROM THE JUDGEMENT OF HONBLE GUJARAT HIGH COURT IN THE CASE OF ACIT VS. ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 11 - GIJATRAT NARMADA VALLY FERTILIZERS CO. LTD. REPORTE D IN 42 TAXMANN.COM 579 WHERE IN IT WAS HELD AS UNDER: APEX COURT IN THIS DECISION OF MUNJAL SALES CORN. (SUPRA) ON HAVING FOUND THAT THE OPENING BALANCE OF THE PROFIT S OF THE ASSESSEE-FIRM WAS HUGE AND THE PROFITS WERE SUFFICI ENT TO COVER THE LOAN GIVEN TO A SISTER CONCERN, WHICH WAS MEAGER AS COMPARED TO THE PROFITS OF THE FIRM AND THEREFORE, IT HELD THAT THE LOANS WERE FROM THE ASSESSEE'S OWN FUND . 16.1 IN VIEW OF THE ABOVE, WE HAVE NO HESITATI ON TO REVERSE THE ORDER OF THE AUTHORITIES BELOW. ACCORDINGLY WE SET ASIDE THE ORDER OF THE LD.CIT (A) AND DIRECT THE AO TO DELETE THE ADDITION MADE BY HIM. HENCE, THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 18. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 01/02/2019 SD/- SD/- ( RAJPAL YADAV ) ( WASEEM AHMED ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 01/02/2019 &.., .(.. / T.C. NAIR, SR. PS ITA NO.645/AHD/2017 ANKUR SCIENTIFIC TECHNOLOGIES PVT.LTD. VS. DCIT ASS T.YEAR 2013-14 - 12 - / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. )*+ , / CONCERNED CIT 4. , ( ) / THE CIT(A)-1, VADODARA 5. /01 ((*+ , *+# , ) / DR, ITAT, AHMEDABAD 6. 145 6 / GUARD FILE. / BY ORDER, / ( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) $%, / ITAT, AHMEDABAD 1. DATE OF DICTATION 16.1.2019 (DICTATION PAD 14- PAGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 16/18.1.2019 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.1.2.19 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 1.2.19 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER