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Income Tax Appellate Tribunal, DELHI BENCH “SMC-I”, NEW DELHI
Before: SHRI S.V. MEHROTRA
per the provisions of the Act then it is for the Assessing Officer to make the necessary corrections but, in any view of the matter, income has to be correctly computed as per the provisions of the Act. However, alternate contention of ld. counsel for the assessee, relying on the decision of Hon’ble Delhi High Court in the case of Joint Investments Pvt. Ltd. (supra), deserves to be accepted and the disallowance has to be restricted only to the dividend income of Rs.21.71. I direct accordingly. In the result, the ground nos.2 to 7 are partly allowed.
Apropos ground no.8, ld. counsel pointed out that loans were given in assessment year 1997-98 to subsidiary companies considering business expediency and need of the business out of free reserves. He further pointed out that the loans were taken by the assessee company during the previous years i.e. assessment years 2009-10 and 2010-11 for business needs and not for giving interest free loans. He submitted that the matter may be restored back to the file of the Assessing Officer to examine the facts afresh in the light of decision of Hon’ble Delhi High Court in the case of CIT vs. Modi Rubber Ltd., (2015) 378 ITR 128 (Delhi).
I have considered the rival submissions of both the parties and have perused the record of the case. The facts need to be re-marshaled in the light of decision of Hon’ble Delhi High Court in the case of Modi Rubber Ltd. (supra). I, therefore, restore this issue to the file of the Assessing Officer for de-novo adjudication. In the result, this ground no.8 is allowed for statistical purposes.
Resultantly, the appeal of the assessee is partly allowed for statistical purposes. Order pronounced in the open court on this 27th day of January, 2017.