main ground in this appeal relates to addition on account of excess breakage of bottles. assessee is running 34 country liquor shops and ITO noticed that assessee had debited Rs. 2,62,127 on account of breakage of bottles as against Rs. 1,15,423 shown in last year. He, therefore, asked t h e assessee to explain reason for excessive breakage of bottles. explanation of assessee was that these expenses did not only include breakage but also price of empty bottles which customers did not return. However, assessee was unable to give details of day to day breakage or stock of empty bottles. According to ITO expenses on breakage were not available for verification. amount of breakage was only Rs. 11,406 in year 1980-81, Rs. 1,15,423 in year 1981-82 but this year it was absolutely high. He, therefore, made addition of Rs. 1,40,000 on this ground. same has been reduced to Rs. 1 lac by CIT(A). assessee, however, is still dissatisfied and has challenged this in its first ground of appeal before us. After carefully considering all facts and circumstances of case, we are not inclined to uphold this addition. reason for our conclusion is slightly different from approach by authorities below. To our mind earlier assessee not giving figures in proper manner. When liquor bottle is sold to customer, it is not only contents of bottle but also bottle itself. What we mean to say is that cost of bottles should have been treated as part of trading account. Any empty bottle available with assessee which would be returned to Government would also add towards total receipts of assessee. In fact assessee was not expected to have too many empty bottles. Either empty bottles would be returned to vend by customer for some consideration or sometime customers after drinking contents would leave bottle but they were not bound to do so. Even otherwise it is not policy of law that customer should drink liquor at vend and return bottle to vendor. In fact law does not encourage drinking in public. Therefore, normally purchaser would take-away bottle in his house. What we mean to say is that cost of all bottles incurred by assessee should be reflected in trading account itself. Now if we go on that basis in immediately preceding year on sales of Rs. 2,07,96,253 gross profit disclosed by assessee was Rs. 10,31,254, from this assessee claimed breakage of bottles at Rs. 1,15,423 and only Rs. 8,000 were disallowed by ITO. Thus gross profit earned by assessee after taking into consideration price of bottles paid came to Rs. 9,23,831 which came to about 4.5. per cent. This year total sales of assessee were Rs. 2,30,08,686. gross profit disclosed was Rs. 12,95,278. From this at best we can deduct total cost of breakage claimed by assessee at Rs. 2,62,127. gross profit would then come down to Rs. 10,33,151. This comes to about 4.5 per cent. Therefore, all over results shown by assessee this year not worse than last year, even if we hold that addition of Rs. 8,000 on account of excessive breakage was rightly made by ITO even though assessee's representative argued that he did not come up in second appeal before Tribunal because amount involved was rather petty. In this behalf we may quote decision in Mantu Biri Factory P. Ltd. vs. ITO (1982) 14 TTJ 259 (Cal), Himalaya Drug Co. vs. ITO (1983) 17 TTJ (Del) 9 and Tax World Vol. IV page 146. We, therefore, delete entire amount of addition made on account of excessive breakage. There are some more small grounds. We proceed to discuss them one by one as under. One ground relates to disallowance out of petrol and diesel expenses. sum of Rs. 3,000 was disallowed. Assessee's argument before us was that all partners of assessee firm except one reside at different places and not much personal use of Jeep and kept by assessee was made by any partner. At time of arguments. Mr. N.M. Ranka suggested that partner residing at Agra, place where vends are run, had his own private car but he could not give its number and this plea was put forth before authorities below. However, keeping in view fact that most of partners of assessee reside at other places, we restrict disallowance to Rs. 2,000. sum of Rs. 1,600 has been disallowed out of repairing account for want o f proper vouchers. Assessee's representative stated that it was difficult to secure vouchers for petty amount. details of expenses are there. Keeping in view all these circumstances we restrict disallowance to Rs. 1,000. Another ground relates to disallowance of Rs. 3,000 out of Theka expenses and Rs. 1,500 out of Basa expenses. These have been maintained by CIT(A) keeping in view past history of case and no interference is called for. Another ground relates to disallowance of Rs. 2,500 out of telephone expenses. This has been confirmed by CIT(A) again keeping in view past history of case and no interference is called for. last ground relates to charge of interest on over withdrawal by partners. ITO noticed that all partners had over-withdrawals from their capital and at end of accounting year all partners had debit balance in capital account. He also found that firm had paid interest on amounts over drawn by partners at Rs. 78,009. He worked out interest on over-drawals at Rs. 24,323 and disallowed same. CIT(A) has confirmed it and assessee has agitated it before us. On behalf of assessee it has been contended that mere overdrawls by partners would not be enough to infer that borrowings to debit balance had not been utilised for business purposes. number of authorities were cited for this proposition. To our mind, all these cases are distinguishable. We agree with assessee that firm is not bound to trade with capital of partners, but can carry on business on entirely borrowed capital and all interest would be allowable even if partners investment in firm is nil. But there is exceptional case. All partners have debit balances at end of year. While it is correct that as whole firm has benefited from investments of partners and utilised same for quite sometime, and if any interest were to be paid on these investments, firm would be liable to pay some net interest to partners and not receive any interest. But interest payment to partners would be otherwise disallowable. Now when account of all partners show debit balance, it obviously means that borrowed funds had been given to partners and assessee was certainly not entitled to interest on such borrowed capital because it is non-business use by firm. However, Mr. Ranka argued that all these over withdrawals by partners were towards end of accounting year because assessee was not able to get contract renewed for next year and partners had withdrawn monies to secure similar contracts elsewhere. According to him all through there had been credit balance of partners. Without expressing any opinion on this issue, because this is matter of detail, we direct that interest shall be disallowed by ITO only on net debit balance of all partners for period during which it had remained negative figure during relevant accounting year and if necessary disallowance shall be accordingly reduced. ground is allowed for statistical purpose in these terms. In result, appeal is partly allowed as above. *** REHMAT KHAN & PARTY v. INCOME TAX OFFICER