SHASHIKANT MANGALDAS CHANDAN,PUNE vs. PR.COMMISSIONER OF INCOME TAX CIRCLE 7, PUNE

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ITA 3165/PUN/2025Status: DisposedITAT Pune31 July 2026AY 2017-186 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the order of the CIT(A) which confirmed the addition made by the AO. The assessee failed to prove the direct nexus between earning income and the claimed deduction with documentary evidence.

What were the facts?

The assessee filed a return of income declaring Rs. 21,07,920/-. The Assessing Officer made an addition of Rs. 39,18,128/- on account of disallowance of interest expenses claimed under Section 57.

What were the issues?

Whether the interest expenses claimed under Section 57 are allowable as a deduction against interest income without establishing a direct nexus with documentary evidence.

Which sections of the Income-tax Act were involved?

Section 57,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “B”, PUNE

Before: SHRI RAMA KANTA PANDA & Ms. ASTHA CHANDRA

For Respondent: Smt. Sandeep P. Sathe, JCIT

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B”, PUNE

BEFORE SHRI RAMA KANTA PANDA, VICE PRESIDENT AND Ms. ASTHA CHANDRA, JUDICIAL MEMBER Assessment Year : 2017-18 Shashikant Mangaldas Pr. Commissioner of Income Tax, Chandan, Circle-7, Pune 204, Gera Chambers, vs. 316, 3rd Floor, Off. Boat Club Road, Aayakar Sadan, Bodhi Towers, Pune-411001. Salisbury Park, Gultekadi, PAN : AANPC8770G Pune-411037 (Appellant) (Respondent) Assessee by : NONE Department by : Smt. Sandeep P. Sathe, JCIT Date of Hearing : 28-07-2026 Date of Pronouncement : 31-07-2026 O R D E R PER ASTHA CHANDRA, J.M.: The appeal filed by the assessee is directed against the order dated 21-10-2025 of the Ld.ADDL/JCIT(A)-2, Coimbatore, u/s. 250 of the Income Tax Act, 1961 (the “Act”), pertaining to Assessment Year (“AY”) 2017-18. 2. None appeared for and/or on behalf of the assessee when the matter was called for hearing on 28-07-2026. No application seeking adjournment of the case has been filed. A perusal of the order sheet entries show that on previous occasions also, no one appeared. Under these circumstances, we deem it proper to decide this appeal on the basis of material available on record and after hearing the Ld.DR.

3.

Briefly stated, the facts of the case are that the assessee is an individual. He filed his return of income for AY. 2017-18 on 06-03-2018, declaring total income of Rs.21,07,920/-. The case of the assessee was selected for scrutiny by CASS under the limited scrutiny criteria and the

assessment was completed by the Ld. Assessing Officer (“AO”) u/s.143(3)of the Act, vide his order dt. 29-11-2019 at the assessed income of Rs.60,26,048/- thereby making an addition of Rs.39,18,128/- on account of disallowance of deduction of interest expenses claimed u/s. 57 of the Act.

4.

On appeal, the Ld.ADDL/JCIT(A) dismissed the appeal of the assessee by observing as under:

5.

Aggrieved with such order of the Ld.ADDL/JCIT(A), the assessee is in appeal before the Tribunal raising the following solitary ground of appeal: “1. On the facts and the circumstances of the case and in law, lower authorities erred in making disallowance of Rs. 39,18,128/- interest expense against interest income earned and added back to total income, without appreciating the submissions made by the appellant in this regard and by rejecting the appellant's contention that as per Section 57

of the IT Act, the expenditure which are expended wholly and exclusively for the purpose of making or earning such income only shall be allowed as deduction, Your appellant prays for deletion of entire addition, and also ignored the fact that in-previous years such claim is allowed Your appellant prays for deletion of entire addition. Your appellant craves for to add, alter amend, modify, delete any or all grounds of appeal before or during the course of hearing in the interest of principle of natural justice.” 6. We have heard the Ld. DR and perused the material available on record. We find that the Ld.AO completed the assessment by making disallowance of deduction of interest expenses of Rs. 39,18,128/- claimed u/s. 57 of the Act against interest income earned by the assessee. On appeal, the Ld.ADDL/JCIT(A) has dismissed the appeal of the assessee for the reasons which we have already reproduced in the preceding paragraphs. From the perusal of the impugned appellate order, we find that the Ld.ADDL/JCIT(A) has dismissed the assessee‟s appeal by giving detailed reasoning and by passing a speaking order. We find that the Ld.ADDL/JCIT(A) in his impugned order has observed that the assessee has not taken any steps to prove the direct nexus between earning the income and the deduction claimed with documentary evidences and hence, he has confirmed the addition/disallowance made by the Ld.AO. Even before us, nothing has been brought on record by the assessee to take a view contrary to the view taken by the Ld.ADDL/JCIT(A). We, therefore, do not find any reason to interfere with the order of the Ld.ADDL/JCIT(A) which is hereby upheld. Accordingly, the solitary ground raised by the assessee is dismissed.

7.

In the result, the appeal of the assessee is dismissed.

Order pronounced in the open Court on 31-07-2026 (RAMA KANTA PANDA) (ASTHA CHANDRA) VICE PRESIDENT JUDICIAL MEMBER पुणे/Pune; दिन ांक/Dated : 31-07-2026 Tadepalli Naga Digitally signed by Tadepalli Naga Murali Mohan Murali Mohan Date: 2026.08.03 10:44:00 TNMM +05'30'

आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: 1. अपील र्थी / The Appellant 2. प्रत्यर्थी / The Respondent 3. The concerned Pr.CIT, Pune 4. DR, ITAT, „B‟ Bench, Pune 5. ग र्ड फ ईल / Guard file. आदेशानुसार/ BY ORDER, ////

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