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2019 (12) TMI 516 - AT - Income TaxAddition of income - interest from savings bank a/c, Interest on FDR, Interest from parties and rent of land - AO in the assessment order passed u/s 143(3) of the Act disallowed the deduction of interest u/s 57(iii) of the Act on the ground that the assessee failed to establish that the expenditure was incurred for earning interest income - HELD THAT:- There is no dispute that in the return of income the assessee has shown entire income as income from other sources which includes interest from saving bank a/c, interest from FDR and interest from parties. It is pertinent to note that an identical issue was also arisen for the Assessment Year 2013-14 and the AO had allowed the claim of interest expenditure to the extent of interest income received from various parties. Thus it appears that interest received by the assessee against these parties for the Assessment Year 2013-14 was accepted by the AO and corresponding interest was also allowed by the AO - The assessee challenged the said action of the AO restricting the claim of deduction on account of interest expenditure to the interest income. However, the ld. CIT(A) while passing the order dated 19-12-2017 for the Assessment Year 2013-14 has confirmed the action of the AO. The claim of interest expenditure of the assessee to the interest income of ₹ 3.57 lacs is allowed - the appeal of the assessee is partly allowed.
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