SHRI. ANAND KULKARANI,BANGALORE vs. INCOME-TAX OFFICER (CPC), BANGALORE

The assessee has raised as many as 4 grounds but the only grievance of the assessee is about granting deduction of reduced amount of interest expenditure of Rs. 150,,,0/- only as against Rs. 351,189/- claimed by the assessee for computing income under the head Income from House Property.

None appeared on behalf of the assessee in spite of notice and hence, this appeal was heard ex parte qua the assessee. Learned DR of the revenue supported the orders of the lower authorities.

I have considered the facts of the case and gone through the orders of the lower authorities. I find that in the original intimation u/s 143 (1) dated 26.03.2010, the loss from house property was totally ignored and when the assessee moved an application for rectification u/s 154, the A.O. allowed set off of such loss under the head Income from House Property to Rs. 150,000/-. As per the Statement of Income available on record, there is rental income of Rs. 60,000/- and after allowing deduction of Property Tax Paid Rs. 4,264/- and 30% as standard deduction, net income before interest is Rs. 39,016/- and there is claim for interest payment of Rs. 390,205/- resulting into loss under this head at Rs. 351,189/- but the A.O. in his order u/s 154 allowed set off of loss of Rs. 150,000/- only. It seems that this is not the case of the A.O. that there is no interest expenditure deductible u/s 24. It seems that the A.O. invoked 1st and second provisos to section 24 but missed this aspect that these provisos can be invoked in the case of the property which is self occupied as provided in section 23 92). In the present case, the property is let out and therefore, these provisos to section 24 cannot be applied. Therefore, I hold that that the A.O. should allow set off of total loss claimed under the head Income from House Properties.

In the result, the appeal of the assessee is allowed.