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TMI Blog2024 (3) TMI 1150X X X X Extracts X X X X X X X X Extracts X X X X ..... at the learned CIT - A has erred in law and on facts in not allowing the deduction of interest expenditure claimed by the appellant amounting to Rs. 32,795,923/- and restricting the deduction only to the tune of Rs. 3,520,886/-. 03. Grounds in ITA No. 3820/Mum/2023:- "1. The learned CIT (A) has erred in law and in facts in passing order under Section 250 of the Act and confirming the order of Learned. Assessing Officer. 2. The learned CIT (A) has erred in law and in facts in not allowing the deduction of interest expenditure claimed by the appellant amounting to Rs.3,27,95,923/- and restricting the deduction only to the tune of Rs.35,20,886/-. 3. The learned CIT (A) has erred in law and in facts in not appreciating that the interest under Section 234B was not calculated by the learned Assessing Officer correctly." 04. Ground no 1 is general in nature and not pressed and hence, dismissed. 05. Ground no 2 is the grievance. Briefly stated the fact shows that :- i. Assessee is a notified person under The Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 and all its assets including bank accounts were attached and are lying in the hands of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it of Rs. 4,108,356/- and has claimed interest expenditure on loan of Rs. 327,95,923/-. He further noted that this identical issue was considered by the coordinate bench in assessment year 2013 - 14 in appellant's own case wherein the appeal of the assessee was allowed on the very same issue. It was held that the assessee had claimed deduction of interest expenditure in that assessment year i.e., assessment year 2013 - 14 of Rs. 23,338,930/-. It was the claim in that year that the assessee is entitled to the deduction to the extent of Rs. 407,230/- being the income earned during the year. The coordinate bench held that the assessee should get deduction of interest expenditure to the extent of interest income earned. The learned CIT - A relying on the findings of the coordinate bench for assessment year 2013 - 14 has held that the interest income on term deposit as per the profit and loss account of the assessee for this year is Rs. 4,108,356/- and assessee has made the claim of deduction of interest expenditure of Rs. 32,795,923/- therefore the claim of deduction is more than the interest income offered for taxation. He therefore held that in line with the decision of the coordinat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee as deduction and the action of the learned CIT (A) of allowing only Rs. 3,520,886/- is erroneous. 07. The learned authorized representative filed 2 paper books before us. The first paper book contains 66 pages wherein the orders passed by the coordinate benches are placed. In the second paper book also containing 65 pages the decision of the coordinate benches in case of assessee for assessment year 2013 - 14, 2014 - 15 and 2015 - 16 dated 15/9/2020, the order of the coordinate bench in case of family member of the assessee in ITA number 6228 and 5839/M/2018 dated 27/11/2019 and the coordinate bench decision in case of Grow more leasing and investment Ltd and others in ITA number 1219/M/2017 dated 27/12/2017 for assessment year 2012 - 13 is placed. 08. The learned authorized representative specifically referred to the decision of the coordinate bench in assessee's own case in ITA number 6957, 6958 and 6959/MUL/2018 dated 15/9/2020. He submits that according to paragraph number nine of that order the issue was decided by following the decision of Grow more leasing and investment Ltd and in the case of Mr. Sudhir H Mehta ITA number 5799/M/2014. He further referred to paragraph ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly considered the rival contention and perused the orders of the lower authorities. Undoubtedly the assessee has earned bank interest of Rs. 41 lakhs. According to section 57 of the income tax act, assessee is entitled to deduction under section 57 (iii) of any other expenditure which is not in the nature of capital expenditure which is laid out or expended wholly and exclusively for the purpose of making or earning such income. Therefore, the issue whether the expenditure of interest is laid out or expended wholly and exclusively for the purpose of making or earning such income is required to be tested. Same has been verified and decided by the coordinate bench in case of assessee for assessment year 2013 - 14 till 2015 - 16 as per order dated 15/9/2020. Further the direction of the learned CIT - A in restricting the deduction to the extent of income earned of term deposit is also not in accordance with the decision of the coordinate bench wherein in case of Mr. Ashwin Mehta in ITA number 5839/M/2018 dated 27/11/2019 wherein against the interest receipt of Rs. 1,801,778/- the coordinate bench has granted the deduction of Rs. 21,969,050/-. In absence of any contrary facts pointed o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This ground of appeal is identical to ground number 2 of the appeal of the assessee for assessment year 99 - 2000 wherein following the various decisions of the coordinate benches in the case of the assessee, we have allowed this ground. For the same reasons, we also allow ground number 2 of the appeal for this year. 015. Ground number 3 of the appeal is with respect to the chargeability of interest under section 234B on income on which tax is deductible, is identical to ground number three of the appeal of the assessee for assessment year 99 - 2000, which we have restored back to the file of the learned assessing officer, for similar reasons we also restore this ground of appeal for this year. 016. Ground number 1 of the appeal is general in nature and therefore same is dismissed. 017. In the result ITA number 3819/M/2023 for assessment year 2005 - 06 of the appeal of the assessee is partly allowed. 018. ITA number 3818/M/2023 is filed by the assessee for assessment year 2006 - 07 against the appellate order passed on 31/8/2023 by the learned CIT - A. 019. Ground number 1 of the appeal is general in nature and therefore same is dismissed. 020. Ground number 2 of the appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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