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TMI Blog2025 (4) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act, for the assessment year 2014-15. 2. The solitary grievance of the assessee is against the denial of the set-off of loss under the head "House Property" against the addition made under section 69 of the Act by applying the provisions of section 115-BBE(2) of the Act. 3. The brief facts of the case pertaining to this issue, as emanating from the record, are: The assessee is one of the partners of the building named "Double Seven Plaza". Pursuant to the survey action under section 133A of the Act conducted in the business premises of M/s NA Fashion Village, which is functioning in the above mentioned building, it was revealed that the building belongs to a group of 8 people including the assessee, wherein 50% of the shares of the bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e which falls within the ambit of section 69 as per the provisions of section 115- BBE(2) of the Act. Accordingly, the loss under the head "House Property" was carried forward. 4. Against the assessment order passed under section 143(3) read with section 147 of the Act, the assessee filed rectification application under section 154 of the Act on the basis that the provisions of section 115-BBE(2) of the Act are applicable for the assessment year 2017-18 onwards, and therefore cannot be applied to the assessment year under consideration. The said rectification application filed by the assessee was dismissed vide order dated 31/01/2022. The learned CIT(A), vide impugned order, dismissed the appeal filed by the assessee against the rectificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the income, inter-alia, referred to in section 69 of the Act, was brought into the statute with effect from 01/04/2017 and, therefore, is applicable for the assessment years 2017-18 onwards. 6. We find that a similar issue pertaining to the prospective applicability of the provisions of section 115-BBE(2) of the Act as introduced in the Act with effect from 01/04/2017, came for consideration before the Hon'ble Jurisdictional Kerala High Court in Vijaya Hospitality and Resorts Ltd. v/s CIT, reported in [2019] 419 ITR 322 (Kerala), wherein it was held that amendment brought in section 115-BBE(2) by Finance Act, 2016 whereby set off of losses against income referred to in section 68 was denied, would be effective from 01/04/2017. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duced only with effect from 1.4.2017. Therefore, question whether set off permissible under section 72(2) read with section 32(2) of the Act would apply with respect to the said income, assumes importance. There again, the crucial aspect relevant for consideration is the nature of the said income. In one of the oldest cases decided by the Honourable Supreme Court, A.Govindarajulu Mudaliar v. CIT [1958] 34 ITR 807 it is held that, "there is ample authority for the position that where an assessee fails to prove satisfactorily the source and nature of certain amounts of cash received during the accounting year, the Income Tax Officer is entitled to draw an inference that the receipts are of an assessable nature". Following the said observation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion by virtue of section 115BBE. It is pertinent to note that, 115BBE had prohibited allowance of deductions alone, as it stood unamended as on the relevant date of the assessment. The explanatory notes to the provisions of the Finance Act, 2016 enumerates the reasons for introduction of the further amendment barring the set off, with effect from 1.4.2017. It is stated that,- "Currently, there is uncertainty on the issue of set-off of losses against income referred to in section 115BBE of the Income Tax Act. The matter has been carried to judicial forums and courts in some cases has taken a view that losses shall not be allowed to be set-off against income referred to in section 115BBE. However, the current language of section 115BBE of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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