DLG BUILDERS PVT LTD,CHANDIGARH vs. DEPUTY COMMISSIONER OF INCOME TAX, CHANDIGARH

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against the order of the Commissioner of Income Tax (Appeals), [hereinafter referred to as CIT(A)]-2, Chandigarh dated 02.03.2016. The assessee has taken following ground of appeal:-

That on the facts and circumstances of the case the Ld. CIT(A)-2, Chandigarh has erred in law and facts in upholding disallowance Rs. 24,27,995/- on account of interest paid on borrowings u/s 24(b) of Act on technical ground though the amount claimed matches with the claim.

ITA No.457/Chd/2016- DLG Builders Pvt Ltd., Chandigarh 2

of disallowance of Rs. 24,27,995/- on account of interest paid on

borrowings u/s 24(b) of the Income-tax Act, 1961 (in short 'the Act').

The Ld. Counsel for the assessee submitted that the amount of

interest was paid by the assessee on account of housing loan, rental

income relating to which was assessed by the lower authorities under

the head ‘income from house property’. The Ld. Counsel has

submitted that the aforesaid expenditure of interest was allowable u/s

24(b) of the Act. However, the lower authorities have denied the

claim of the assessee for the reason that the assessee could not

establish that the aforesaid payment of interest was relating to the

property, income for which has been assessed under the head ‘income

form house properly’. He has submitted that the lower authorities

have not appreciated the evidence filed by the assessee in this

respect. The Ld. Counsel has, therefore, submitted that he may be

given an opportunity to demonstrate before the Assessing officer

about the facts of housing loan and thereby incurring of interest

relating to the house property, income from which has been assessed

under the head ‘income from house property’.

lower authorities.

relief that the assessee has claimed that he may be allowed to

demonstrate before the lower authorities the nexus between the

interest expenditure and the income from the house property. In our

ITA No.457/Chd/2016- DLG Builders Pvt Ltd., Chandigarh 3

view, no prejudice will be caused to the Revenue if the assessee is

given an opportunity to appear and demonstrate true facts to the

Assessing officer on this issue. In view of this, the issue is restored

to the file of the Assessing officer for adjudication afresh. Needless

to say that the assessing officer will provide proper opportunity to

the assessee to present its case and thereafter will decide the issue in

accordance with law.

statistical purposes.

Order pronounced in the Open Court

Sd/- Sd/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated :27.03.2018 Rkk

Copy to: 1. The Appellant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR