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Income Tax Appellate Tribunal, DELHI BENCH “F”: NEW DELHI
Before: SHRI SHAMIM YAHYA & SHRI ANUBHAV SHARMA
The Revenue has come in appeal against the order dated 21.08.2018 passed by the Commissioner of Income Tax (Appeals)-7, New Delhi (hereinafter referred as “learned First Appellate Authority” or in short “FAA”) in appeal no. 10474/466/CIT(A)-7/Del/2017-18 for the assessment year 2015-16, arising out of 27.12.2017 u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred as the “Act”), passed by the Assistant Commissioner of Income Tax, Circle-19(1), New Delhi (hereinafter referred in short as “Ld. AO”).
Heard and perused the record.
As the case was called for hearing, none appeared for the assessee. Record shows that assessee is not putting in appearance for long. On the last date of hearing, notices were issued through learned DR and report of service is filed.
Arguments of learned DR were heard, who submitted that learned CIT(Appeals) has fallen in error in deleting the addition without examining the commercial exigency of the borrowing cost of the loan.
Appreciating the material on record it can be observed that the learned AO had found that the sum of Rs. 7,75,00,000/- in the form of loan had increased in the account of assessee without any change in the assets.
Before learned CIT(Appeals) it was claimed that there was swapping of loan for which some mandatory fees were paid and these were considered to be interest cost. Learned CIT(Appeals) seems to have given benefit of Circular dated 20.08.1969, however, without examining the business exigency of swapping of the loan. Accordingly, ground nos. 1 to 3 of the Revenue’s appeal are allowed. The Revenue is allowed and the impugned order of learned CIT(Appeals)
is set aside.
Order pronounced in open court on 09.05.2023.