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PER PAWAN SINGH, JUDICIAL MEMBER;
This appeal by assessee under Section 253 of Income-tax Act is directed against the order of ld. CIT(A)-2, Mumbai dated 27.10.2016 for Assessment Year 2012-13. The assessee has raised the following grounds of appeal:
This Appeal is against the Order dated October 27,2016, of the Commissioner of Income Tax (Appeals) - 2, Mumbai, and relates to the Assessment Year 2012-13. 1) The learned Commissioner of Income Tax (Appeals) erred in not adjudicating the issue as to whether the interest expenditure attributable to the borrowings utilized for placing business deposits was not allowable against the interest income earned by the Appellant Company from such deposits and that such interest expenditure was to be treated as part of the project cost.
Mum 2017-Godrej Estate Developers Ltd.
2) The learned Commissioner of Income Tax (Appeals) erred in confirming the action of the Assessing Officer in levying interest u/s. 234D of the Act. The Appellant denies the liability towards the erroneous levy of interest u/s. 234D of the Act, and submits that the same be deleted. 3) The learned Commissioner of Income Tax (Appeals) erred in confirming the action of the Assessing Officer in not granting interest u/s. 244A of the Act on the refund due as per the Return of Income and as determined in the Intimation issued under Section 143(1) of the Act.
Brief facts of the case are that the assessee-company is engaged in the business of Property Development, filed its return of income for Assessment Year 2012-13 on 29.09.2012 declaring total income at Rs. 2,08,61,041/-. The assessment was completed under section 143(3) on 27.02.2015 determining the total income at Rs. 2,18,84,560/-. The Assessing Officer while passing assessment order besides the various other additions, disallowed interest expenditure of Rs. 10,23,518/- and treated the same as income from Other Sources. On appeal before ld. CIT(A), the said income was allowed to be treated as Business Income.
However, the ld. CIT(A) failed to adjudicate the grounds of appeal related to the expenditure incurred for earning such interest income. Hence, aggrieved by the order of ld. CIT(A), the assessee has filed present appeal before us.
We have heard the ld. Authorized Representative (AR) of the assessee and learned Departmental Representative (DR) for the revenue and gone through the orders of authorities below. At the outset of hearing, the learned AR of the assessee submits that the only grievance in the present appeal of the assessee is that the CIT(A) failed to adjudicate the issue as to 2 Mum 2017-Godrej Estate Developers Ltd. whether the interest expenditure attributable to the borrowing utilised for placing business deposit was not allowable against the interest income by the assessee. Therefore, the appeal may be restored to the file of ld. CIT(A) for deciding the issue afresh.
On the other hand, the learned DR for the revenue after going through the content of the impugned order fairly conceded that the ld. CIT(A) failed to adjudicate the said grounds of appeal
, therefore, he has no objection, if the appeal is restored to the file of ld. CIT(A) for adjudicating the issue afresh.
5. We have considered the rival submission of the parties and have gone through the orders of the authorities below. We have noted that the ld. CIT(A) allowed the Interest Income as business income in place of income from other sources, however the grounds related to expenditure attributable to earning of such income was not adjudicated. Therefore, we deem it appropriate to restore the issue to the file of ld. CIT(A) to decide the issue afresh. Needless to say that ld. CIT(A) shall grant opportunity to the assessee before passing the order in accordance with law.
6. In the result appeal of the assessee is allowed for statistical purpose.
Order pronounced in the open court on 04/09/2018.