JUDGMENT : K.S. Jhaveri, J. Since in all these appeals, common questions of law and facts are involved, they are decided by this common judgment. 2. By way of these appeals, the appellants have challenged the judgment and order of the Tribunal whereby the Tribunal has partly allowed the appeals of the assessee and dismissed the appeal of the department modifying the order of the CIT(A) whereby the CIT(A) has allowed the appeal in favour of the assessee. 3. In Appeal No. 460 of 2009, originally the matter was admitted by the order dated 02.09.2009 only on one issue which was subsequently amended by us on 24.2.2017 pursuant to the application preferred by the department which reads as under:- "(i) Whether in the facts and circumstances of the case, the ITAT was justified in law in deleting and restricting the trading additions which was made after rejecting books of accounts under section 145(3) of the Act?. (ii) Whether in the facts and circumstances of the case, the ITAT was justified in law in allowing the deduction under section 80IA when the assessee does not fall in the same? (iii) Whether in the facts and circumstances of the case, the ITAT was justified in law in directing to allow the higher rate of interest to the persons specified under section 40A(2)(b) of the Act." D.B. Income Tax Appeal No. 547 of 2009 admitted on 07.09.2009:- "(i) Whether in the facts and circumstances of the case, the ITAT was justified in law in deleting and restricting the trading additions which was made after rejecting books of accounts under section 145(3) of the Act?. (ii) Whether in the facts and circumstances of the case, the ITAT was justified in law in allowing the deduction under section 80IA when the assessee does not fall in the same? (iii) Whether in the facts and circumstances of the case, the ITAT was justified in law in directing to allow the higher rate of interest to the persons specified under section 40A(2)(b) of the Act." D.B. Income Tax Appeal No. 37 of 2010 admitted on 3.2.2011:- "(i) Whether in the facts and circumstances of the case, the ITAT was justified in law in deleting and restricting the trading additions which was made after rejecting books of accounts under section 145(3) of the Act? (ii) Whether in the facts and circumstances of the case, the ITAT was justified in law in allowing the deduction under section 80IA when the assessee does not fall in the same? (iii) Whether in the facts and circumstances of the case, the ITAT was justified in law in directing to allow the higher rate of interest to the persons specified under section 40A(2)(b) of the Act." D.B. Income Tax Appeal No. 72 of 2010 admitted on 03.02.2011: "(i) Whether in the facts and circumstances of the case, the ITAT was justified in law in allowing the deduction under section 80IB when the assessee does not fall in the same?" D.B. Income Tax Appeal No. 348 of 2011 admitted on 12.10.2011:- "(i) Whether the Tribunal was justified in answering the issue contained in paragraph 17 and 19 of the impugned order as ground no. 1 and 2 against the Revenue (appellant herein) without assigning any reasons except to rely upon their earlier view said to have been taken by the Tribunal in respect of this very assessee for the previous year without quoting as to what was that view? (ii) Whether Tribunal was justified in holding that assessee is entitled to claim deduction of Rs. 1,29,629/- by taking recourse to the provisions of Section 40A(2)(b) of the Act? (iii) Whether Tribunal was justified in holding that assessee is entitled to claim benefit of deletion of Rs. 80,91,340/- as required under Section 80IB of the Act?" D.B. Income Tax Appeal No. 365 of 2011 admitted on 9.4.2012:- "(i) Whether under the facts and circumstances of the case ITAT is justified in confirming the order of CIT(A) of allowing the deduction under Section 80IB of Rs. 48,29,638/- which was disallowed by the AO, particularly when the assessee does not fulfill the conditions laid down for claim of deduction under Section 80IB of the Act? (ii) Whether under the facts and circumstances of the case and in law, the ITAT is justified in confirming the order of CIT(A) of deleting the addition of Rs. 3,15,647/- made by the AO on account of interest paid to specified persons under section 40A(2)(b)? (iii) Whether under the facts and circumstances of the case the ITAT is justified in confirming the order the CIT(A) directing the AO to allow expenses of Insurance of Rs. 80,122/- relating to earlier year?" 4. 3,15,647/- made by the AO on account of interest paid to specified persons under section 40A(2)(b)? (iii) Whether under the facts and circumstances of the case the ITAT is justified in confirming the order the CIT(A) directing the AO to allow expenses of Insurance of Rs. 80,122/- relating to earlier year?" 4. Counsel for the appellant has taken us to the order of the AO as well as the order of CIT(A) and contended that the issue of Section 145(3) which has been adjudicated by the AO has wrongly been considered by the CIT (A) and the Tribunal. On the question of deduction made under section 80IA, she further contended that the benefits were not granted in view of the short fall which was made in view of the observations made by the AO. Even as per Section 40A(2)(b), the rate of interest which was paid to the family members was not consistent with the other persons whereas the family members were granted amount on a higher side, and therefore, the Tribunal has seriously committed an error in allowing these expenses. 5. In one of the appeal No. 365 of 11, additional issue is framed regarding insurance expenses which reads as under:- "Whether under the facts and circumstances of the case, the ITAT is justified in confirming the order of CIT(A) directing the AO to allow expenses of Insurance of Rs. 80,122/- relating to earlier year?" 6. After considering the said issue, the AO has observed in para 6 which reads as under:- "Prepaid Insurance Expenses Vide letter dated 11.12.2007, the assessee has filed the details of insurance expenses debited to the P&L account at Rs. 6,50,098/- in response to question No. 5 dated 30.11.2007. This claim of expenditure includes a sum of Rs. 80,122/- of prepaid expenses pertaining to the previous year. Further, from the assessment records of the preceding year, it is seen that while finalizing the assessment proceedings for the assessment year 2004-05, the Assessing Officer has not made any additions on this account. Thus, considering the accounting method of the assessee, this expenditure is not allowable in this year, hence the same is disallowed and added back to the total income of the assessee." 7. The Tribunal while considering the observations of CIT(A) which is contrary to the evidence on record has observed in para 10 as under:- "10. Thus, considering the accounting method of the assessee, this expenditure is not allowable in this year, hence the same is disallowed and added back to the total income of the assessee." 7. The Tribunal while considering the observations of CIT(A) which is contrary to the evidence on record has observed in para 10 as under:- "10. The fourth ground of the Revenue is as under:- "on the facts and in the circumstances of the case, the ld. CIT(A), Kota has erred in deleting the disallowance of Rs. 80,122/- made by the AO on account of insurance expenses despite the fact that the same was not allowable considering the method of accounting followed by the assessee." 8. Counsel for the respondent has placed reliance on the judgments in the case of Commissioner of Income Tax v. Satellite Engineering Ltd. (1978) 113 ITR 208(Guj), Commissioner of Income Tax v. Seeyan Plywoods (1991) 190 ITR 564 (Guj) and Commissioner of Income Tax v. Bhawani Forge P. Ltd. in Tax Appeal No. 1321, 1326 & 1328/2006 decided on 1.12.2014 (Guj.). 9. We have heard the counsel for the parties. 10. On the first issue, in our considered opinion, in view of the observations made by the tribunal with regard to section 145(3), unless the books of accounts which have been found not genuine and the reasons for rejecting the books of accounts is just and proper, the view taken by the Tribunal is required to be upheld. In that view of the matter, the issue is answered in favour of the assessee. 11. With regard to second issue, counsel for the respondent has placed reliance on the judgment rendered in the case of Commissioner of Income Tax v. Bhawani Forge P. Ltd. in Tax Appeal No. 1321, 1326 & 1328 decided on 1.12.2014 wherein it has been observed as under:- "In view of the aforesaid, we are of the opinion that the Tribunal has given cogent and convincing reasons in arriving at the conclusion and we are in complete agreement with the view taken by the Tribunal. The Tribunal after considering the material on record has rightly held that the assessee has satisfied all the conditions in order to avail benefit of section 80IA of the Income Tax Act. The Tribunal after considering the material on record has rightly held that the assessee has satisfied all the conditions in order to avail benefit of section 80IA of the Income Tax Act. Apart from that, learned advocate for the appellant-revenue is not in a position to show how the findings of the Tribunal are bad in law and on facts. In that view of the matter, we do not find any error in the order of the Tribunal. Hence, the present appeals are dismissed. Accordingly, the question of law posed in these appeals is answered in favour of the assessee and against the revenue." 12. In view of the observations made, the second issue is also answered in favour of the assessee. 13. With regard to issue of loan which was advanced by the family members, the Tribunal has rightly observed in para 13 which reads as under:- "13. We have heard the rival contentions and perused the facts of the case. We are convinced with the arguments of the ld. AR as to prevailing market rate for the loans of the permanent in nature and long term loans is between 18% to 24% whereas the cases compared by the AO are pertaining to the loans of the temporary in nature. Also the assessee has advanced the money for the purpose of business needs, is not under dispute. Therefore, in such circumstances and facts of the case, the AO is not justified in considering the said payment of interest as excessive or unreasonable and the same is directed to be deleted. Thus ground No. 1 of the CO of the assessee is allowed. 14. With regard to additional issue of insurance, the Tribunal has rightly observed in para 11 which reads as under:- "11. The facts of the case are that the assessee has claimed the insurance expenses of Rs. 6,50,098/- in the Profit & Loss A/c. On being asked, it is explained that the amount of Rs. 6,50,098/- also includes the expenses of Rs. 80,122/- of prepaid expenses pertaining to previous year. The AO found from the assessment record of the preceding year that in the assessment year 2004-05, the AO has not made addition on this account. Thus according to the AO and considering the accounting method of the assessee, this expenditure is not allowable in this year and hence he made the addition of Rs. 80,122/-" 15. The AO found from the assessment record of the preceding year that in the assessment year 2004-05, the AO has not made addition on this account. Thus according to the AO and considering the accounting method of the assessee, this expenditure is not allowable in this year and hence he made the addition of Rs. 80,122/-" 15. In that view of the matter, all the issues are answered in favour of the assessee and against the department. 16. The appeals stand dismissed. A copy of this order be placed in each file.