FAHIM RAI ,SECUNDERABAD vs. INCOME TAX OFFICER, WARD-10(5), HYDERABAD

Coming to the first issue of interest disallowance 2. amounting to Rs.3,87,013/- made u/s 69C of the Act in both the lower appellate proceedings, we note from a perusal of CIT(A)’s discussion in Para 7.1 to 7.12 that the same had rather been paid from his wife’s bank account only without any nexus qua loans and advances in question. We note in these facts that the learned lower authorities have rightly disallowed the impugned instant in these peculiar facts and circumstances.

It is clear form a perusal of the above extract of lower appellate discussion that the impugned interest amount pertains to housing loan, vehicle loan and personal loan only without having any nexus with the assessee’s business / professional activity. Learned counsel vehemently contended before us that the assessee has intended to carry out his professional activity from residential property only. We find no merit in the assessee’s foregoing arguments as both the lower authorities detailed discussion made it clear that the loan account in question had no nexus with the assessee’s business / professional activity u/s 57 of the Act. The impugned disallowance stands confirmed accordingly.

Lastly comes credit card addition of Rs.1,30,000/- u/s 69C of the Act. The CIT(A)’s detailed discussion confirms the same as under :

Learned authorised representative fails to rebut the clinching fact that the assessee had not been able to prove the corresponding cash payment by explaining the source thereof as evident in the lower appellate discussion. We thus find no reason to interfere with the learned CTI(A)’s action affirming the impugned addition.