GURCHARAN SINGH BHATIA,NEW DELHI vs. ACIT CIRCLE-47(1), NEW DELHI

ITA 3433/DEL/2019Status: DisposedITAT Delhi11 January 2024AY 2014-151 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee's business of real estate and finance had been accepted in prior years, and the interest paid was for business purposes. Regarding the cash deposits, the Tribunal found that the Assessing Officer failed to consider the opening cash balances and realizations from debtors, thus the addition under Section 68 was unsustainable.

What were the facts?

The assessee claimed deduction for interest paid on loans, stating it was for real estate and finance business. The Assessing Officer disallowed this, believing the funds were diverted for non-business purposes. The assessee also faced an addition of Rs. 66,70,000 on account of cash deposited in the bank under Section 68.

What were the issues?

Whether interest paid on loans is an allowable business expenditure when the assessee is engaged in real estate and finance business. Whether cash deposits in the bank can be added as unexplained income under Section 68 without considering the assessee's cash flow and opening balances.

Which sections of the Income-tax Act were involved?

Section 37(1),Section 36(1)(3),Section 68

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Cases cited in this judgment(4)Show list

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Income Tax Appellate Tribunal, DELHI BENCH ‘H’, NEW DELHI

Before: SHRI SHAMIM YAHYA & SHRI CHALLA NAGENDRA PRASAD:

For Appellant: Shri K. Sampath & V. Rajkumar
For Respondent: Shri Amit Katoch, Sr. DR
Hearing: 29.11.2023Pronounced: 11.01.2024

PER CHALLA NAGENDRA PRASAD: JUDICIAL MEMBER This appeal is filed by the assessee against the order of the learned Commissioner of Income-Tax (Appeals)-16, New Delhi

dated 26.03.2019 for the assessment year 2014-15. The assessee

has raised the following grounds of appeal:

2 “On the facts and in the circumstances of the case and in law the Ld. CIT(Appeals) erred in confirming the following additions made to the returned income by the Assessing Officer: i. Rs.1,65,62,973/- on account of interest paid; ii. Rs.66,70,000/- on account of cash deposited in bank invoking section 68 of the Income-Tax Act, 1961. Both the above actions being erroneous unlawful and untenable it is prayed that the same must

The order continues below.

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