9911796707
TMI Blog2025 (3) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... t Year 2017-18. 2. The grounds raised by the assessee are as under: 1.1 The Order u/s. 263 passed on 27-03-2024 by Pr.CIT.Ahmedabad-1, A'bad (for short Pr. CIT) for AY 2017-18 holding that assessment order passed u/s. 147 r.w.s. 144B dated 31.03.2022 for the A.Y. 2017-18 was erroneous and prejudicial to the interest of the revenue is wholly illegal, unlawful and against the principles of natural justice. 2.1 The Id. Pr. CIT has grievously erred in law and or on facts in holding that the order of assessment u/s 147 rws 144B passed on 31.03.2022 by AO accepting the deduction of interest expenses u/s 57(iii) was erroneous and prejudicial to the interest of the revenue. 2.2 That the in the facts and circumstances of the Id. Pr. CIT o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest income earned, having claimed huge interest expenses against the same, and further noting that as per section 57(iii) of the Act, this interest expenses were allowable only when they were incurred for the purpose of earning interest income. Therefore, clearly the case of the assessee was reopened to ensure the assessee's claim of interest expenses was in accordance with section 57(iii) of the Act. Therefore, the case of the ld. Pr. CIT was that the assessee's claim of interest expenses was not examined by the AO in the light of the provisions of section 57(iii) of the Act, while passing his order under section 147 of the Act, allowing the entire claim of interest expenses. 5. The finding of the ld. Pr. CIT however, we find, while h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted to verify as to whether the recipients have offered interest income in their respective ITR, if it is found so, the A.O. may not disallow such interest income 57(iii) of the Act. If it is found otherwise, the A.O. is directed to disallow only those interest expenses which have not been offered by respective recipients. With these findings, the assessment order stands modified accordingly. 6. Clearly his finding of error vis a vis allowance of claim of interest expenses to the assessee is with regard to its genuineness and noting doubts about the genuineness he goes to state that if the said expenses are not found genuine they are to be disallowed u/s 57(iii) of the Act. The Ld. PCIT, we find has completely misdirected himself in his ..... X X X X Extracts X X X X X X X X Extracts X X X X
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