ALNESH MOHAMADAKIL SOMJI,PUNE vs. ASSISTANT COMMISSIONER OF INCOME TAX, PUNE

ITA 34/PUN/2025Status: DisposedITAT Pune27 June 2025AY 2018-1926 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the interest expenditure incurred by the assessee was wholly and exclusively for the purpose of earning income. It found that the Assessing Officer had not properly appreciated the facts and that the CIT(A) was not justified in confirming the AO's finding without ascertaining all facts.

What were the facts?

The assessee claimed deduction for interest paid on borrowed funds used for investments in firms. The Assessing Officer disallowed a portion of this deduction, arguing that the interest paid exceeded the interest received and that the funds were not exclusively used for earning income. The CIT(A) dismissed the assessee's appeal.

What were the issues?

Whether interest expenditure on borrowed funds used for investments in firms is deductible when interest paid exceeds interest received, and whether the funds were exclusively used for earning income.

Which sections of the Income-tax Act were involved?

Section 57(iii),Section 14A

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Cases cited in this judgment(2)Show list

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

Before: SHRI R. K. PANDA & MS ASTHA CHANDRA

For Appellant: Shri Nitin Rander
For Respondent: Shri Amol Khairnar CIT-DR

The above 2 appeals filed by the assessee are directed against the common order dated 07.11.2024 of the Ld. CIT(A), Pune -11 relating to assessment years 2018-19 and 2019-20 respectively. For the sake of convenience, these appeals were heard together and are being disposed of by this common order.

2.

Facts of the case, in brief, are that the assessee is an individual and partner in various firms of Gagan group of cases. He filed his original return of income u/s 139(1) of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') on 31.10.2018 declaring total income of Rs.Nil (for assessment year 2019-20 at Rs.57,29,190/-). The assessee

The order continues below.

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