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आदेश/Order
The present appeal has been preferred by the assessee against the order dated 27.04.2018 of the Commissioner of Income Tax (Appeals), Shimla [hereinafter referred to as ‘CIT(A)’].
The assessee in this appeal has taken following grounds of appeal:- 1. That on the facts and circumstances of the case, the order passed by the Ld. A.O. and the Ld. CIT(A) in concurrence with that of the Ld. Assessing Officer is wrong, against facts and specific provisions of law.
ITA No. 836-Chd-2018- Ravi Bindal & Madan Lal Chaudhar, Solan 2
That on the facts and circumstances of the case, the Ld. CIT(A) is not at all justified in upholding the addition of Rs. 8,68,216/- in respect of disallowing interest claimed under ‘Income from House Property.’
The sole issue involved in this appeal is relating to the
disallowance of interest expenditure claimed by the assessee as
deduction against the rental income earned from House Property as per
provisions of section 24 of the Income Tax Act, 1961 (in short 'the
Act').
The assessee during the year earned a total rental income from
house property of Rs. 14.49 lacs. The assessee claimed a deduction of
Rs. 8,68,216/- on account of interest expenditure incurred for
acquisition and construction of house property as allowable under the
provisions of section 24 of the Act. A perusal of the impugned order of
the CIT(A) reveals that the Ld. CIT(A) has rejected the aforesaid claim
of the assessee on two grounds; firstly, that the assessee has not placed
the copy of the relevant loan agreement / bank papers to show that the
aforesaid loan was taken for acquisition / construction of the house
property in question; secondly, that even otherwise the total investment
in the building including lift as per the balance sheet was of Rs.
1,40,75,414/-, however, the assessee claimed the deduction of interest
expenditure on a total loan of Rs. 1.61 crores.
ITA No. 836-Chd-2018- Ravi Bindal & Madan Lal Chaudhar, Solan 3 4. The Ld. Counsel for the assessee has submitted that he is ready to
produce the relevant evidence before the Assessing Officer to show that
the aforesaid loan was taken for acquisition / construction of the
building in question.
So far as the contention raised by the Ld. CIT(A) that as against
the total loan of Rs. 1.61 cores, the assessee has incurred expenditure of
Rs. 1.40 crores on the building, the Ld. Counsel for the assessee has
submitted that the assessee has taken loan in two parts. In first part, a
loan of Rs. 70 lacs was taken which was fully utilized, however, out of
the second loan amount of Rs. 1 crore, the assessee utilized most of
the amount except some amount which was deposited in the shape of
FDR with the bank to be used as and when required. The Ld. Counsel for
the assessee has submitted that the assessee may be allowed to
demonstrate before the Assessing Officer as to exactly what amount of
loan was used for acquisition / construction of the building and that how
much of proportionate disallowance is attracted, considering the date of
the loan sanctioned and date of utilization of the same etc.
I find force in the above submissions of the Ld. Counsel for the
assessee and considering the same, I accordingly set aside the order of
the CIT(A) and restore the matter to the file of the Assessing Officer to
examine the limited aspects as noted above and to decide the matter
afresh on this issue in accordance with law.
ITA No. 836-Chd-2018- Ravi Bindal & Madan Lal Chaudhar, Solan 4 In the result, the appeal of the assessee is treated as allowed for statistical purposes.
Order dictated and pronounced in the Open Court immediately on completion of hearing. Sd/-
(संजय गग� / SANJAY GARG) �या�यक सद�य/ Judicial Member Dated : 06.06.2019 “आर.के.”
आदेशक���त�ल�पअ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकरआयु�त/ CIT 4. आयकरआयु�त (अपील)/ The CIT(A) 5. �वभागीय��त�न�ध, आयकरअपील�यआ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड�फाईल/ Guard File
आदेशानुसार/ By order, सहायकपंजीकार/ Assistant Registrar