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2021 (7) TMI 449 - ITAT DELHIDisallowance of interest u/s 36(1)(viii) - allocation of the assessee on account of interest with regard to segmental reporting in respect of housing loan business, loan against property and other business - HELD THAT:- Similar issue has been decided by the revenue in favour of the assessee for A.Y. 2012-13 wherein held that AO has not examined the submissions furnished by the appellant company and simply disallowed the deduction. Deduction claimed u/s. 36(1)(viii) is duly supported by segmental accounting which includes apportionment of expenses, details of which are filed before the AO and in appellate proceedings - a more acceptable method for determining the profits from eligible business would be allocation of interest expenditure on the basis of turnover of the eligible and ineligible business segments. AO is directed to recompute the profit of eligible business deduction by allocating interest expenditure on the basis of turnover and not on the basis of balance of outstanding housing loan and loan against property recoverable at the end of the year as apportioned by the appellant company. Deduction u/s. 36(1)(viii) i.e. 20% shall be allowed on such profits and gains of the eligible business arrived after apportionment of the interest expenditure on the basis of turnover ratio of the two segments. Addition on account of cessation of trade liability - CIT(A) deleted the addition on the ground that the amount has not been remitted from the books of accounts of the assessee and not even three years have been passed, hence, they are beyond the provisions of the law of limitation and creditor can always claim the amount from the assessee - HELD THAT:- The debts still subsists. On going through the fact on record, we find no legal infraction in the decision of the Ld. CIT(A) and hence decline to interfere with the order of the Ld. CIT(A) on this ground.
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