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2013 (9) TMI 635 - AT - Income TaxIncome from house property - Interest claim as deduction u/s 24(a) of the Income Tax Act Held that:- Rental income from the individual flats owned by the assessee and her husband Shri Gurdas Mann have been included in their respective hands, the deduction on account of the interest paid on borrowed capital utilised for the purchase of the said flat is to be allowed in the equal proportion in the hands of the assessee and her husband Shri Gurdas Mann - The UTI bank in their certificate has clearly mentioned the name of the applicant to be Shri Gurdas Mann and name of co-applicant to be Smt. Manjit Mann. The total loan of Rs. 1.50 crores has been utilised for the purchase of the two flats - Claim of the assessee in relation to the interest paid on housing loan totalling Rs. 5,14,802 has been allowed Decided in favor of Assessee. Ad-hoc disallowance of expenditure made by assessee Held that:- The assessee had booked the expenditure and the Assessing Officer had disallowed 3 per cent, resulting in addition of certain amount - The addition made by the Assessing Officer is ad hoc addition as the assessee had furnished partial vouchers and bills raised by parties, were not maintained - In the interest of justice and to plug the leakage of revenue, restricted the disallowance at one per cent of the total expenditure. Disallowance of expenditure under the head "repair and maintenance" Expenditure was incurred on replacement of electricity installation and also for the purchase of new furniture Held that:- No merit in the claim of the assessee that it was a case of mere replacement and not the case of coming into existence of new fixed asset. The expenditure incurred on purchase of new furniture cannot be held to be replacement and the same being in the nature of capital expenditure, is not to be allowed as a deduction while computing the income of the assessee Further, assessee had failed to bring on record any evidence to establish its claim of having replaced the electric installation or the nature of the electric installation so replaced Decided against the Assessee.
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