JATIN KANUBHAI SHAH,MUMBAI vs. THE DEPUTY COMMISSIONER OF INCOME TAX, 13(2)(2), MUMBAI, MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL
“F” BENCH MUMBAI

BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER &
SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER
Jatin Kanubhai Shah
Flat No. 3, Sterling
Diamonds Flats Mount
Mary Road, Bandra (W),
Mumbai – 400050. Vs. DCIT, Circle – 13(2)(2)
Aayakar Bhavan, MK
Road, Mumbai – 400020. PAN/GIR No. AGYPS1618Q
(Applicant)
(Respondent)

Assessee by None
Revenue by Ms. Nidhi Agarwal, Sr. DR

सुनवाईक तारीख/Date of Hearing
07.01.2025
घोषणाक तारीख/Date of Pronouncement
13.01.2025

आदेश / ORDER

PER SANDEEP GOSAIN, JM:

The present appeal has been filed by the assessee challenging the impugned order dated 07.10.2024, passed u/s 250 of the Income Tax Act, 1961 (‘the Act’), by the Learned Commissioner of Income Tax (Appeals) / National
Faceless
Appeal
Centre,
Delhi
(‘Ld.
CIT(A)’), for the assessment year 2011-12. 2. At the time of hearing, none appeared on behalf of the assessee when the case was called neither any application for 2
Jatin Kanubhai Shah, Mumbai seeking adjournment has been filed which shows that assessee is not interested in pursuing the present appeal, moreover today is the 8th opportunity of hearing, therefore we see no justification in further adjourning the case, therefore assessee is proceeded ex-parte. On the contrary, the Ld. DR present in the court is ready with the arguments, therefore we have decided to proceed with the hearing of the case ex- parte.
Ground No. 1. Raised by the appellant is as follows:
“1. The Ld. AO has erred in law as well as the facts in making disallowance of interest of Rs. 6,16,473/-, in respect of bank overdraft u/s 57 of the Act and the Ld. CIT(A) NFAC, Delhi has erred in confirming it.”
3. This ground raised by the assessee was dealt with by Ld.
CIT(A) in its order and the operative portion of the order of Ld. CIT(A) is contained in para 5.2 and the same is reproduced herein below:
5.2 Findings and decision:-
I have carefully considered the facts of the case as well as submissions filed by the appellant. I find no force in the arguments taken by the appellant. The Appellant has given lengthy submissions and relied on various case laws but has refrained to detail the 'facts of the case' which establish a nexus between the interest outgo and the interest income earned. The only single sentence submitted in support of the contention is that:-
Further, in order to prove that the over draft taken from bank was repaid from fund withdrawn from proprietorship
'Ghanshyam Enterprises' details have been mentioned in 3
Jatin Kanubhai Shah, Mumbai ground no 2 and therefore it is clear that the total interest paid including interest on over draft should be allowed as deduction against interest income taxable under the head other sources.
Maybe, the overdraft was repaid from the funds withdrawn, maybe not, but this has no bearing on how the funds from this OD facility were utilized. The Appellant has given no submission or details as to how these funds were utilized and establish a nexus between the funds withdrawn from the OD account and the interest income earned. In absence of this information, the plea of the Assessee is rejected. The appellant has also relied on certain case laws, but they are distinguishable on facts from the appellant's case.
Accordingly, the disallowance of interest ofRs.6,16,473/- made by the AO is hereby confirmed. The ground of appeal
No.1 is thus, dismissed.
4. Ld. DR relied upon the order passed by the revenue authorities. Even before us none appeared on behalf of the assessee to rebut or controvert the lawful findings so recorded by the Ld. CIT(A) and the assessee has miserably failed to establish a nexus between the interest income out go and the interest income earned. No submissions or details were filed to demonstrate as to how these funds were utilized and establish a nexus between the funds withdrawn from the OD account and the interest income earned.
Therefore in the absence of this information we find no reason to interefere into the findings so recorded by the Ld.
CIT(A) therefore this ground raised by the assessee is dismissed.
Ground No. 2. Raised by the appellant is as follows:

4
Jatin Kanubhai Shah, Mumbai

5
Jatin Kanubhai Shah, Mumbai account. The only argument raised by the assessee before the revenue authorities was that the funds have been sourced from Vatica Enterprises by the firm and an interest
@ 6% has already been paid by firm by Sham Enterprises to this concern i.e Vatica Enterprises. Thus, under these circumstances AO has rightly pointed out that the material fact for consideration and adjudication is that the assessee himself is paying interest @ 10%. Therefore the disallowance is rightly made in the hands of the asessee by the revenue authorities. Therefore after considering the entire facts and circumstances of the present cas,e we feel no justifiable reasons to interfere into or to deviate from the findings so recorded by the revue authorities, therefore this ground of appeal also stands dismissed.
7. In the result the appeal filed by the assessee is dismissed.
Order pronounced in the open court on 13.01.2025. (PRABHASH SHANKAR) (SANDEEP GOSAIN)
ACCOUNTANT MEMBER JUDICIAL MEMBER

Mumbai, Dated 13/01/2025

KRK, PS

6
Jatin Kanubhai Shah, Mumbai

आदेश की ितिलिप अेिषत/Copy of the Order forwarded to :

आदेशानुसार/ BY ORDER,
सािपत ित ////