9911796707
TMI Blog2017 (11) TMI 637X X X X Extracts X X X X X X X X Extracts X X X X ..... lowing only Rs. 23,067/- (8.31% of Rs. 2,77,578/-) in respect to Delhi Office. 4. That Ld. CIT(A) has erred seriously in law and facts in allowing only Rs. 3,06,706/- as against Rs. 36,90,804/- being the interest on loan on office/home loan paid to M/s. Dewan Housing Finance Corporation Ltd. 5. That Ld. CIT(A) has erred in confirming and upholding the disallowance of Rs. 1,83,856/- being the service tax paid by the appellant during the year under consideration." 4. According to the Registry, the appeal is time barred by 13 days. The assessee moved an application for condonation of delay. It is explained that the impugned order was received on 04th March, 2017, but the impugned order was placed by peon on a different file. It was only after some search in the entire Office record, the impugned order was found and appeal was immediately filed. Considering the nominal delay in filing the appeal in the light of explanation of assessee, I am satisfied with the explanation of assessee that assessee was prevented by sufficient cause in not filing the appeal within the limitation. I, accordingly, condone the delay in filing the appeal. 5. Briefly the facts of the case are that ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee and accordingly, interest claimed on loan for house property amounting to Rs. 36,90,804 was disallowed. The A.O. also disallowed depreciation on office at Ranikhet of Rs. 52,015 and depreciation on office premises of Rs. 2,77,578 and added back the sum of Rs. 3,29,539 to the income of the assessee. 6. The A.O. also noted that assessee has claimed service tax amounting to Rs. 1,83,856 as business expenses against receipt of professional fees of Rs. 50,66,906. The service tax @ 12.36% on professional receipts would come to Rs. 5,57,360. No service tax return were produced in spite of giving number of opportunities to the assessee. The A.O. in the absence of any evidence disallowed service tax and made the addition of Rs. 1,83,856. 7. The assessee challenged the additions before the Ld. CIT(A). The written submissions of assessee were reproduced in the impugned order in which the assessee briefly reiterated the same facts as pleaded before A.O. and it was also explained that assessee is providing consultancy services and advised on strategy of Medium and Large organisations, on their growth and performance improvements. The assessee charged consultancy fees and maintain office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness only to the extent of 8.31%, therefore, to the same extent, depreciation was allowed in a sum of Rs. 23,067 and balance of Rs. 2,54,511 was disallowed. The Ld. CIT(A) as regards disallowance of interest on loan claimed for office purpose forwarded written submissions and documents furnished by the assessee at appellate stage to the A.O. and A.O. was directed to personally verify the factual position by making the inspection of the property so as to determine the actual use of the property. The A.O. submitted a remand report in which the A.O. on inspection of the property in question submitted that assessee is having one room with small pantry, one toilet for office use on North East side at ground fllor of L-1/13, Hauz Khas Enclave, New Delhi with separate entry which is used for office purpose only. The above said portion used for office purose is 249.66 sq. feet out of total area of the ground floor of 1714.16 sq. feet which comes to 14.58% of the ground floor. Balance is residential portion having separate entry utilized by the assessee for residential purpose. Moreover, there is no way inside to enter from office side to residential side. The assessee is showing office pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 013 for A.Y. 2010-2011 along with copy of the acknowledgment of the return of income and income and expenditure account to show that interest on office/home loan have not been disallowed by A.O. in A.Y. 2010-2011. He has submitted that even depreciation has not been disallowed. He has, therefore, submitted that interest and depreciation may be allowed in full deduction. 10. On the other hand, Ld. D.R. relied upon the orders of the authorities below. 11. In the assessment year under appeal, the A.O. disallowed the entire interest and depreciation because the property was found residential and was not used for the purpose of office/profession. The submissions of the assessee and documents were forwarded to the A.O. at appellate stage for factual verification of use of the property for business purpose or not. The A.O. gave his remand report after physical inspection of the property in question and submitted that assessee is having one room with small pantry and one toilet for office use on north-east side at ground floor of the property. This fact has not been disputed by the assessee through any evidence or mateiral on record. During the assessment year under appeal the assessee w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice tax, the assessee did not produce any evidence before authorities below to justify his claim of deduction. No copy of the return and challan of payment of service tax have been filed. Therefore, claim of assessee cannot be verified whether service tax is paid for professional receipts earned by the assessee in assessment year under appeal. A.O. also noted that the total service tax payable by the assessee comes to Rs. 5,57,360 but assessee claimed payment of Rs. 1,83,856. Therefore, facts were not verifiable from the explanation of assessee. The assessee filed copy of the bank certificate of Axis Bank before Ld. CIT(A) which also did not reveal anything in favour of the assessee. The assessee has filed copy of the bank certificate from Axis Bank which only confirm that assessee paid service tax payment. But it is not clarified as to on which professional income assessee has paid the service tax. In the absence of clarification of the payment of service tax for earning professional income, no interference is called for in the matter. Ground No.5 of appeal of assessee is also dismissed.
14. In the result, appeal of assessee is dismissed.
Order pronounced in the open Court. X X X X Extracts X X X X X X X X Extracts X X X X
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