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Income Tax Appellate Tribunal, MUMBAI BENCH “SMC” MUMBAI
Before: SHRI R.C. SHARMA & SHRI PAWAN SINGH
PER PAWAN SINGH, JUDICIAL MEMBER;
This appeal by assessee is directed against the order of ld. CIT(A)-48, Mumbai dated 12.10.2018 for Assessment Year 2013-14. The assessee has raised the following grounds of appeal:
1. Learned C.I.T. (A) 48 erred in disallowing Interest claim of Rs.20,37,586/- against property Income on the Ground that Interest paid on loan taken are against purchase of Property without any documentary evidence, even though full details were submitted. Appellant prays to allow Interest of Rs.20,37,586/- against Property Income.
2. Learned C.I.T. (A) 48 erred in not giving specific order that interest wrongly claimed u/s 57(iii) instead of claim u/s 24 i.e. income from house property, even
Bharat VirchandGada 2 ITA No. 7240/Mum2018 though Revised Return was filed during Assessment proceedings. Appellant prays to allow claim of interest against Property Income.
3. Learned C.I.T. (A) 48 erred in not giving specific order that Revised Return filed before Assessing Officer during Assessment proceedings for claim of Interest u/s 24 instead of u/s 57(iii) is not maintainable. Appellant prays that Revised Return filed during Assessment proceedings should have been considered.
4. Learned C.I.T. (A) 48 erred in not considering utilization of loan against purchase of property on which Rent Received, for which details were given. Appellant prays to consider loan is utilized for purchase of property and prays to allow Interest of Rs20,37,586/-.
5. Without prejudice Appellant prays to allow Interest of Rs.17,04,373/- as worked and submitted to C.I.T. (A) during hearing against Property Income.
6. Learned C.I.T. (A) 48 erred in dismissing 4 Grounds of Appeal altogether without discussing separately each Ground of Appeal.
Brief facts of the case are that the assessee is an individual and showing its income from ‘house property’ and ‘other sources’ filed his return of income for AY 2013-14 on 16.01.2014 declaring total income of Rs.17,95,360/-. The case was selected for scrutiny. On perusal of details filed by the assessee, the Assessing Officer noted that the assessee has claimed interest expenses under section 57 of the Income Tax Act, 1961 of Rs.20,37,586/-. The assessee has not shown any income under the head ‘income from other sources’. The assessee has taken set off of loss under the head ‘income from other sources’ with the income form ‘house property’. The Assessing Officer issued show cause notice to the assessee. The assessee filed its reply dated 04.12.2015. In reply to the assessee stated that he has taken loan and purchase the godown. The assessee has declared income from house property and claimed interest loss under section 57 of the Act, the assessee has claimed set off of interest loss against the ‘house property’. The assessee
Bharat VirchandGada 3 ITA No. 7240/Mum2018 wants to file revise return declaring the interest under section 24 and furnished the revised return. The Assessing Officer noted that the claim of the assessee cannot be accepted in view of the decision of Hon’ble Supreme Court in Goetz India Ltd. v. CIT on 24.03.2006. Accordingly, the deduction claimed by assessee was disallowed.
On appeal before Ld. CIT(A), the assessee took plea that payment of interest is wholly relates to house property and furnished various calculations and balance sheet for various year. On perusal of details furnished by assessee, the Ld. CIT(A) concluded that assessee simply made a claim of interest and has not furnished any evidence to substantiate his claim and nexus on interest expenses and accordingly affirm the action of the Assessing Officer. Thus further aggrieved the assessee has filed appeal before us.
None appeared on behalf of the assessee despite services of notice of hearing of appeal. Perusal on record reveals that assessee has furnished same paper book containing page number 1 to 35. Thus, we left no option to accept heir the submission of Ld. DR and to decide the appeal on the basis of material available on record. The Ld. DR for the Revenue supported order of Assessing Officer. The Ld. DR submits that the assessee before lower authorities failed to substantiate that assessee paid interest for acquisition of property/warehouse. There is no documentary evidence to substantiate that assessee has incurred expenses for acquisition of any house property or the interest payment has any nexus that income from house property. No documentary evidence is filed by assessee before Tribunal. Thus the assessee is not entitled for any relief.
Bharat VirchandGada 4 ITA No. 7240/Mum2018
We have considered the submission of Ld. DR for the Revenue and perused the order of lower authorities including the documents filed by way of paper book. We have noted that the assessee has claimed interest expenses of Rs.20,37,586/-. The Assessing Officer as well as Ld. CIT(A) disallowed the interest expenses in absence of any evidence about the nexus of interest payment with the income from house property. Before us, the assessee has not filed any documentary evidence to prove the nexus of interest expenses with the earning of income from house property. Therefore, we do not any merits in grounds of appeal raised by the assessee.
In the result, the appeal is dismissed.