Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (5) TMI 242 - ITAT MUMBAIDeduction of interest from house property income (rental income) - assessee had claimed deduction u/s 24 on account of interest payment - Held that:- The same issue arose before the Tribunal in AY 2011-12 as held revenue erroneously restricted the claim of the assessee towards interest payable on the borrowed capital, only for the part of the year during which the property had remained in existence. We are persuaded to observe that if the legislature would have intended to restrict such a claim of the assessee, then the same would have specifically been provided for in the statute. We are thus of the considered view that the CIT(A) had erred in sustaining the order of the AO and thus misinterpreting the scope and gamut of Section 24(b), had wrongly disallowed 50% of the aforesaid ‘Interest on borrowed capital' - Decided in favour of assessee Disallowing set off of interest expenditure against interest income earned - whether direct and proximate nexus is established among surplus borrowed fund used for fixed deposit made from which interest income is earned - Held that:- We set aside the order of the Ld. CIT(A) and restore the matter to the file of the AO to make a fresh order after examining the contentions of the assessee. AO would examine the Fixed Deposit ledger account as well as Bank Book for the year under consideration as well as of preceding year. We direct the assessee to file the relevant documents/evidence before the AO. Disallowance of business loss - AO disallowed on the ground that the assessee has not done any business activity during the year under consideration and in the earlier years - Held that:- It is found from the annual accounts that the assessee has claimed a deduction of ₹ 7,894/-. It represents expenditure on rates and taxes to the tune of ₹ 14,768/-. Out of the above sum, an amount of ₹ 6,876/- has been disallowed u/s 14A of the Act. We further find that the above expenditure claimed is towards maintaining existence of the company. In view of the above facts, we delete the disallowance
|