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2021 (6) TMI 596 - AT - Income TaxDisallowance of interest - assessee made advance payment for purchase of flats/office premises for investment purposes - HELD THAT:- The finding of the case decided in Reliance Utilities & Power Ltd [2009 (1) TMI 4 - BOMBAY HIGH COURT] is duly applicable to the facts of the present case in which it is specifically held that if there are funds available both interest free and overdraft and/or loans taken then a presumption would arise that investments would be out of the interest free fund generated or available with the company, if the interest free funds are sufficient to meet the investment. Since the issue is squarely covered by the decision of the Hon’ble ITAT in the assessee’s own case [2020 (7) TMI 764 - ITAT MUMBAI] therefore, we set aside the finding of the CIT(A) on this issue and allowed the claim of the assessee. Disallowance of rent expenses - assessee has taken the premises at Vapi, & Lonavla for the purpose of business - HELD THAT:- The rent agreement speaks about this fact that the property was taken for the business purposes. Rent has also been mentioned in the agreement. The assessee also book the property on Lonavla on rent in sum of ₹ 10,000/- per month which was for the residence of employees. The TDS was deducted from every property. Nothing is on record to which it can be assumed that the property was not used for the business purposes. At least, it is necessary on the part of the AO to collect same material to which it can be assumed that the property was not taken on rent for the business purposes. The copy of agreement with regard to the residential property at Vapi dated 01.10.2011 to 30.09.2014 and dated 01.10.2014 to 30.09.2017. The copy of receipt of rent paid for the period of on 01.04.2012 to 31.03.2016. No cogent and convincing reason on the record to decline the claim of the assessee. Taking into account all the facts and circumstances, we are of the view that the finding of the CIT(A) is not justifiable, hence, we set aside the finding of the CIT(A) on this issue and allowed the claim of the assessee.
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