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2016 (1) TMI 743 - ITAT LUCKNOW

2016 (1) TMI 743 - ITAT LUCKNOW - TMI - Assessment of interest income - business income or income from other sources - Held that:- The assessee has not brought any material to show that interest income is taxable under any other head except income from other sources and therefore, we are of the considered opinion that the order of the Ld. CIT(A) is not sustainable because interest income is definitely taxable under the head income from other sources, until and unless, it is shown by the assessee .....

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he value of capital work in progress regarding construction of Hotel China Gate - CIT(A) deleted the addition - Held that:- Addition is not made by the AO on estimate basis but this is on the basis of actual basis between investment declared by the assessee and valued by the registered valuer as per the valuers report submitted by the assessee itself. This addition was deleted by the CIT(A) on this basis that the addition was made by the AO subject to rectification as per outcome of DVO’s report .....

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considered opinion that no interference is called for in the order of Ld. CIT(A) on this issue also because AO estimated ₹ 20,000/- as disallowable for the reason that the expenses is not fully verifiable and as against this, it was estimated by the Ld. CIT(A) that disallowance of ₹ 10,000/- out of staff welfare expenses is reasonable. We are of the considered opinion that in the facts of the present case, estimate by Ld. CIT(A) appears to be reasonable and hence, we decline to inte .....

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of revenue is rejected whereas grounds raised by the assessee in the CO are allowed. - ITA No.24/LKW/2015, C.O. No. 03/LKW/2015 - Dated:- 29-10-2015 - SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER Appellant : Shri Amit Nigam, DR Respondent : Shri Lalit Mahajan ORDER PER A. K. GARODIA, A.M. This is Revenue s appeal and the Cross objection is filed by the assessee and these are directed against the order of Ld. CIT(A) -II, Lucknow dated 07.10.2014 for AY 2011-12. .....

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69 of the Income Tax Act, 1961 made on account of investment from undisclosed source. The CIT(A) failed to appreciate that the amount of ₹ 13,24,106/- was difference between the value determined by the valuer and value of investment disclosed by the assessee. 3. The Commissioner of Income Tax (Appeals), Lucknow has erred in law and on the facts of the case in deleting the addition of ₹ 3,00,000/- made out of traveling and conveyance expenses being not verifiable. 4. The Commissioner .....

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ommissioner of Income Tax (Appeals) erred in confirming disallowance of brokerage expenditure of ₹ 50000/-. 2. That the learned commissioner of Income Tax (Appeals) failed to appreciate the written submission that the brokerage of ₹ 374400/- was paid to Suman Bhattacharya through cheque and tax deducted U/s 194H was deposited in the Government account (Ground No. 4 Page 6 of CIT order) 3. That the brokerage expenditure of ₹ 50000/- may kindly be deleted. 4. Ld. DR of the Revenu .....

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ubmission appearing on pages 2 and 3 of the paper book are the submissions of Ld. AR regarding the issue raised by the Revenue in its appeal and also regarding the issues raised by the assessee in its CO. This Para is reproduced herein below for the sake of ready reference: 5) Submissions with regard to ground of appeal Ground No. 1 The department is not justified in raising a new point that assessee company is neither a financial institute nor a banking company. The Assessing officer had neithe .....

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s not found unsatisfactory. Further addition was made subject to rectification u/s 154. Adhoc disallowance was made by the Assessing officer without pointing out any unverifiable item (Para 4 -page 3 of order) Ground No 4 The sum of ₹ 60000/-includes ₹ 50000/- out of brokerage and ₹ 10000/- out of welfare expenses. Regarding brokerage of ₹ 50000/ The Assesses company paid brokerage of ₹ 374400/- to Shri SUMAN BHATTACHARYA through cheque and tax deducted u/s 194H was .....

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.1 of the Revenue s appeal, we find that reliance has been placed by the Ld. AR of the assessee on the decision of the Hon ble Allahabad High Court rendered in the case of Dr. (Mrs.) Chandrawati Vs. CIT 164 Taxman 24 (Alld.). In this case, it was held by the Hon ble Allahabad High Court that if a new claim is before the Tribunal, which was not raised before the AO or CIT(A), the Tribunal was perfectly justified to refuse to entertain such claim. In the present case, it is not the case that a new .....

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rectly claimed and shown interest income under the head of business income continuously in past years. Hence, it is seen that no reasoning is given by Ld. CIT(A) as to how the judgment of the Hon ble Allahabad High Court rendered in the case of Indo Gulf Fertiliser and Chemicals Corporation Ltd. (Supra) followed by the AO is not applicable. As per this judgment of the Hon ble Allahabad High Court followed by the AO, it was held that interest income is taxable as income from other sources. While .....

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saying that the assessee company is neither a financial institution nor the banking company. Even if we exclude this argument then also interest income has to be assessed as income for other sources because as per section 56(1) of the Act, if it is not shown by the assessee that interest income is chargeable to tax under any other head, it is taxable under this head. The assessee has not brought any material to show that interest income is taxable under any other head except income from other so .....

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we reverse the order of the Ld. CIT(A) on this issue and restore that of the AO. Accordingly, Ground No.1 of the Revenue is allowed. 8. Regarding Ground no.2 of the Revenue s appeal, we find that addition was made by the AO is on the basis that as per the report of the registered valuer submitted for the value of capital work in progress regarding construction of Hotel China Gate, value was determined by the valuer at ₹ 4,50,00,000/- as on 01.04.2011 and the AO observed that there is stil .....

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er outcome of DVO s report. This is not the case of the Ld. CIT(A) that DVO has determined the value of the property at or near to the value of investment shown by the assessee. Hence, we are of the considered opinion that the order of the Ld. CIT(A) on this issue is also not sustainable. We, therefore, reverse his order on this issue also and restore that of the AO. Ground No.2 of the Revenue is also allowed. 9. Ground No.3 of the Revenue s appeal and all the grounds raised by the assessee in t .....

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f Staff Welfare and in this manner, he allowed relief of ₹ 60,000/- Now the Revenue is in appeal for this relief of ₹ 60,000/- allowed by the CIT(A). The assessee has raised the CO and disputed the disallowance of ₹ 50,000/- confirmed by the Ld. CIT(A) out of brokerage expenditure. Ld. AR reiterated the same contentions which were raised before the CIT(A) and Ld. DR of the Revenue supported the assessment order. 10. We have considered the rival submission. We find that the disa .....

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