SHIVAJI NATHA GAIKWAD,,KOLHAPUR vs. INCOME-TAX OFFICER, WARD - 2(1),, KOLHAPUR

आदेश / ORDER PER ANIL CHATURVEDI, AM :

Assessee is an individual who is having income from salary and other sources. Assessee filed his return of income for A.Y. 2011-12 on 01.08.2011 declaring total income at Rs.7,92,740/-. The case was selected for scrutiny

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and thereafter assessment was framed u/s 143(3) of the Act vide order

dt.03.07.2013 and the total income was determined at Rs.9,09,550/-.

Aggrieved by the order of AO, assessee carried the matter before Ld.CIT(A),

who vide order dt.01.06.2018 (in appeal No.Kop/343/2013-14) granted

partial relief to the assessee. Aggrieved by the order of Ld.CIT(A), assessee is

now in appeal before us and has raised the following effective ground :

“On facts and in circumstances of the case the Learned CIT(A) has erred in law and on merit in confirming addition of Rs.41,043/- in account of disallowance of repayment of Housing Loan installment paid to BSNL Co-operative Credit Society when such claim was allowable u/s 80C(xviii)(b) of the Income Tax Act.”

Ld.A.R. seeking adjournment in the case. The adjournment was refused in

view of the issue involved in the present appeal. We therefore proceed to

decide the appeal ex-parte qua the assessee.

Considering the smallness of delay, we condone the delay and admit the

appeal for hearing.

assessee had claimed Rs.41,053/- as principal amount paid to BSNL

Employees Coop Credit Society for the loan taken for construction of house.

AO sought information from BSNL Employees Coop Credit Society wherein

the Society stated that it cannot vouch the end use of loan taken by any

member since it has given loan against salary. Therefore, AO concluded that

assessee has not taken loan from purchase of house property and hence,

the principal amount claimed u/s 80C of the Act was disallowed by him.

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Aggrieved by the order of AO, assessee carried the matter before Ld.CIT(A),

who upheld the order of AO. Aggrieved by the order of Ld.CIT(A), assessee is

now before us.

issue in the present case is with respect to disallowance of Rs.41,053/- on

account of deduction u/s 80C of the Act. We find that before Ld.CIT(A), it

was assessee’ submission that he had obtained housing loan from BSNL

Employees Coop Credit Society for construction of house and for which

during the year there was re-payment of interest and principal amount. It

was further assessee’s submission that the certificate issued by BSNL was

submitted wherein it was stated that the loan was advanced for the purpose

of construction of house. It was further submitted by the assessee that the

loan application by the assessee also states the purpose to be ‘loan for the

purpose of construction of house’. Assessee submitted that the sanction

letter dated 24.06.2013 issued by BSNL Employees Coop Credit Society also

states that the loan was utilized for construction of house. However, AO

made the addition considering the fact that assessee had not utilized the

amount for construction of house. We find the copy of letter of BSNL

Karmachari Sakahari Pat Sanstha Maryadit, Kolhapur dated 24.06.2013

attached with assessment order, which states that the Society does not

vouch the end of use of the loan taken by the member. We find that based on

the aforesaid letter, AO had concluded that the loan has not been used for

construction of house by the assessee. We find that AO has only disallowed

the principal re-payment but has allowed the interest component under

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income from house property. Before us, no material has been placed by Revenue to controvert the submissions made by the assessee about obtaining the loan for construction of house which is also certified by BSNL. Considering the totality of the facts, we are of the view that AO was not justified in denying the claim of deduction u/s 80C of the Act on the principal repayment towards housing loan and therefore we direct the deduction. Thus, the ground of assessee is allowed.

Order pronounced on 18th day of April, 2019.

Sd/- Sd/- (SUSHMA CHOWLA) (ANIL CHATURVEDI) �या�यक सद�य / JUDICIAL MEMBER लेखा सद�य / ACCOUNTANT MEMBER

पुणे Pune; �दनांक Dated : 18th April, 2019. Yamini

आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to :

आदेशानुसार/ BY ORDER // True Copy // व�र�ठ �नजी स�चव / Sr. Private Secretary आयकर अपील�य अ�धकरण ,पुणे / ITAT, Pune.