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2016 (7) TMI 1015 - AT - Income TaxDeduction of interest expenditure - income from house property - annual value determination - Held that:- Section 23 contemplates the manner as to how annual value will be determined. Section 24 provides certain deductions against house property income. Now in the present case, the assessee has no income from Bungalow No.2 at Deep Mangal Society. His income under the head “Income from house property” has also not been shown. If we look to the scheme of section 24(b) along with two proviso, then it would reveal that if the assessee had given a choice for self-occupied property with regard to the Bungalow No.2, and then under first proviso he could claim deduction to the extent of ₹ 30,000/-, and if it establishes fulfillment of conditions provided in second proviso, then to the extent of ₹ 2.00 lakhs. The assessee has to prove that this bungalow was purchased with borrowed funds. But neither the bungalow was ready for self-occupation nor the assessee has given a choice. Thus, under this head also the assessee is not entitled for deduction of an interest expenditure. In view of the above discussion it is concluded that under both the fold of propositions, the assessee is not entitled for the deduction of interest expenditure. - Decided against assessee Adhoc disallowance - Held that:- The assessee failed to establish that the expenditure was exclusively incurred for the purpose of business or profession. Possibility of user of car for personal purpose cannot be ruled. Therefore, adhoc disallowance made by the AO and confirmed by the ld.CIT(A) is justified - Decided against assessee
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