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2016 (2) TMI 85 - AT - Income TaxDeduction U/S 57 - deduction of of interest expenditure against interest income - nexus between borrowing of funds from the bank and interest income earned on the FDR - Held that:- CIT(A) has not applied his mind to decide the evidentiary value of the documents sought to be brought on record by the assessee rather acted as a post office to tow the line of Assessing Officer. When the assessee has specifically come up with the defense that the deduction claimed by her (the assessee) u/s 57 of the Act are based upon the documents sought to be brought on record by way of additional evidence, it was incumbent upon Ld. CIT(A) to decide the application on merit and not without disputing the documents (agreement to sell) in question sought to be brought on record by the assessee. The claim of the assessee cannot be thrown into the dustbin on the basis of conjectures and surmises that the agreement does not prove any nexus between the interest income earned form FDR and interest paid on OD account claimed u/s 57 of the Act without declaring the agreement as false and frivolous document. Without entering into the merits of the case, we are of the considered view that the file is required to be restored to Ld. CIT(A) for fresh adjudication by taking out into account the loan documents relied upon by the assessee. Needless to say that Ld. CIT(A) is require to provide adequate opportunity of being heard to the parties before passing fresh order. - Decided in favour of assessee for statistical purposes.
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