Section 24(b) of the Income Tax Act

Income-tax Act, 2025: s.22

Section 24(b) falls under section 24 of the Income-tax Act, 1961, which corresponds to section 22 (Deductions from income from house property) of the Income-tax Act, 2025.

Read section 22 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 24(b) is CIT v. Mithilesh Kumari (92 ITR 9), cited in 54 of the 545 judgments on BharatTax that turn on this section.

Leading authorities on Section 24(b)

CIT v. Mithilesh Kumari
92 ITR 9 · 1973 · High Court
54
citing judgments

Interest on borrowed capital used to acquire an asset, paid year after year until the date of sale, must be capitalized and included in the cost of acquisition for computing capital gains.

CIT v. Cocanada Radhaswami Bank Ltd.
57 ITR 306 · 1965 · Supreme Court
46
citing judgments

The nature of the activity giving rise to income is fundamental in determining the deductibility of expenses. Interest on loans for acquiring properties held as current assets is a deductible business expenditure if incurred for business purposes.

CIT v. Mythreyi Pai
152 ITR 247 · 1985 · High Court
44
citing judgments

Expenditure incurred towards the purchase of shares is a capital expenditure and therefore, interest expenditure incurred on such purchases is not eligible for deduction under Section 36(1)(iii) of the Income Tax Act.

CIT v. Hughes Escorts Communications Ltd.
311 ITR 253 · 2009 · High Court
29
citing judgments

Expenses incurred prior to business commencement but after business setup are deductible as revenue expenses, as the setting up and commencement dates of a business are not necessarily the same.

UOI v. Wood Papers Ltd.
4 SCC 256 · 1990 · Reported
29
citing judgments

In the interpretation of taxing statutes, exemption provisions are to be construed strictly, but once eligibility criteria are met, the exemption notification should be liberally construed to give it full play.

CIT v. Jaypee DSC Ventures Ltd.
335 ITR 132 · 2011 · High Court
28
citing judgments

Interest income generated from fixed deposits, if purchased due to business exigencies or for the purpose of carrying on business activities, is to be treated as business income and not income from other sources.

CIT v. Surinder Pal Anand, Surinder Pal Anand
242 CTR 61 · 2011 · High Court
20
citing judgments

When an assessee opts for the presumptive taxation scheme under Section 44AD of the Income Tax Act, offering income at a specified percentage of gross receipts, they are exempt from maintaining books of account and are not obligated to explain individual entries of cash deposits unless such entries lack nexus with the gross receipts.

CIT v. Taj International Jewellers
20 Taxmann.com 1 · 2012 · High Court
17
citing judgments

Interest paid on borrowed funds used to purchase FDRs is deductible as an expenditure incurred wholly and exclusively for earning taxable interest income, establishing a clear nexus between borrowing and earning interest.

CIT v. K. Raja Gopala Rao
252 ITR 459 · 2001 · High Court
15
citing judgments

Mortgage expenses and interest payable on a mortgage used as part of the purchase consideration are included in the cost of acquisition for computing capital gains on the transfer of property.

CIT v. Runwal Developers (P) Ltd.
15 Taxmann.com 196 · 2011 · High Court
14
citing judgments

Maintenance charges received for the promotion and upkeep of a mall are business receipts assessable under the head 'Income from business'. This applies even if part of the premises is sold on an outright sale basis.

Judgments on Section 24(b)

Pradeep Rajkarat, Bhubaneswar vs. ITO, Ward-1(4), Bhubaneswar

In the result, appeal of the assessee is partly allowed for statistical purposes

ITA 91/CTK/2019[2010-11]Status: DisposedITAT Cuttack06 Jun 2019AY 2010-11

Bench: Shri Chandra Mohan Gargआयकर अऩीऱ सं./Ita No.91/Ctk/2019 (नििाारण वषा / Assessment Year :2010-2011) Pradeep Raj Karat, Vs. Ito, Ward-1(4), Ofs Dp, Sf Pri Campus, Bhubaneswar Ghatikia, Bhubaneswar-29 स्थायी ऱेखा सं./ जीआइआर सं./ Pan/Gir No. : Abrpk 4652 J (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) यनधागररती की ओर से /Assessee By : Shri P.C.Sethi, Ar राजस्व की ओर से /Revenue By : Shri Subhendu Dutta, Dr सुनवाई की तारीख / Date Of Hearing : 15/05/2019 घोषणा की तारीख/Date Of Pronouncement 06/06/2019 आदेश / O R D E R This Is An Appeal Filed By The Assessee Against The Order Of Cit(A)- 2, Bhubaneswar, Dated 28.01.2019 Passed In First Appeal No.0455/2015- 16 For The Assessment Year 2010-2011, Wherein The Assessee Has Raised The Following Grounds Of Appeal :- 1. That, The Learned Cit(A) Has Committed Serious Error In Not Quashing The Assessment Order Which Is Based On The Notice Under Section 143(2) Of The Income-Tax Act, 1961 (Hereinafter Referred As "The Act") Under The Direction Of Chief Commissioner Of Income-Tax, Odisha Region, Bhubaneswar Which Is Illegal, Without Jurisdiction & Contrary To The Provisions Of The Act & For Which The Assessment Made Under Such Illegal Notice & Is Liable To Be Quashed And/Or Annulled. 2. That, The Learned Cit (A) Has Committed Serious Error By Not Deleting The Addition Made By The Learned Assessing Officer Of Rs. 3,61,535/-. 3. That, The Learned Cit (A) Has Committed Serious Error In Not Deleting The Disallowances Made By The Learned Assessing Officer Under Hra Of Rs.33,311/- Which Is Liable To Be Allowed.

For Appellant: Shri P.C.Sethi, ARFor Respondent: Shri Subhendu Dutta, DR
Section 143(2)Section 143(3)Section 24Section 80C

DCIT Cir 6(2)(1), Mumbai vs. City Centre Mall Nashik P.Ltd, Mumbai

In the result, appeals filed by the revenue are hereby ordered to be dismissed

ITA 745/MUM/2018[2013-14]Status: DisposedITAT Mumbai24 Apr 2019AY 2013-14

Bench: Shri Rajesh Kumar, Am & Shri Amarjit Singh, Jm आयकर अपील सं/ I.T.A. Nos.745 & 746 /Mum/2018 (निर्धारण वर्ा / Assessment Years: 2013-14 & 2014-15) बिधम/ Acit Cir 6(2)(1) M/S. City Centre Mall Nashik Pvt. Ltd. 5Th R. No. 504, Floor, Vs. Room No.62, Plot No. 8-9, Aayakar Bhavan, M.K. Parekh Mahal, Lady Road, Mumbai-400020. Jamshedji Road, Sakharam Keer Marg, Mahim, Mumbai-400016. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaccc6422B (अपीलाथी /Appellant) (प्रत्यथी / Respondent) .. Revenue By: Shri Abi Rama Kartikiyen Assessee By: Shri Rajendra Daga/ Abdul Gani सुनवाई की तारीख / Date Of Hearing: 06.03.2019 घोषणा की तारीख /Date Of Pronouncement: 24/04/019 आदेश / O R D E R Per Amarjit Singh, Jm: The Above Mentioned Appeals Have Been Filed By The Revenue Against The Order Dated 23.11.2017 Passed By The Commissioner Of Income Tax (Appeals)-12, Mumbai [Hereinafter Referred To As The “Cit(A)”] Relevant To The A.Y.2013-14 & 2014-15. Ita. No.745/M/2018:- 2. The Revenue Has Filed The Present Appeal Against The Order Dated 23.11.2017 Passed By The Commissioner Of Income Tax (Appeals)-12

For Appellant: Shri Rajendra Daga/ Abdul GaniFor Respondent: Shri Abi Rama Kartikiyen
Section 2Section 24Section 36(1)(iii)

M/S Mfar Developers Pvt Ltd, Bangalore vs. The Deputy Commissioner of Income Tax Circle-4(1)(2), Bangalore

In the result, the assessee’s appeal for assessment year 2012-13 is partly allowed

ITA 731/BANG/2018[2014-15]Status: DisposedITAT Bangalore24 Apr 2019AY 2014-15

Bench: Shri B.R. Baskaran & Shri Pavan Kumar Gadale1. Ita Nos.1649/Bang/2017 (Assessment Year: 2012-13) 2. Ita No.730/Bang/2018 (Assessment Year: 2013-14) & 3. Ita No.731/Bang/2018 (Assessment Year; 2014-15) M/S.Mfar Developers Pvt. Ltd. No.3, Lavelle Road, Bengaluru-560 001. … Appellant Pan:Aafcm 6271 M Vs. 1-2. Assistant Commissioner Of Income-Tax, Circle 4(1)(2), Bengaluru. 3. Deputy Commissioner Of Income-Tax, Circle 4(1)(2), Bengaluru. … Respondent Appellant By : Shri K.K.Chythanya, Advocate. Respondent By : Dr. P.V.Pradeep Kumar, Addl.Cit(Dr) Date Of Hearing: 22/03/2019 Date Of Pronouncement: 24/04/2019 O R D E R Per Pavan Kumar Gadale, Jm: The Assessee Has Filed Appeals Against Different Orders Of The Cit(A) For Assessment Years 2012-13, 2013-14 & 2014- 15. Ita Nos.1649/Bang/2017 & 730 & 731/Bang/2018 Page 2 Of 16 2. As Far As Ground No.2 In Respect Of Disallowance Of Proportionate Interest U/S 24(B) Of The Income-Tax Act,1961 ['The Act' For Short], The Assessee Has Raised Similar Grounds Of Appeal For Assessment Years 2012-13, 2013-13 & 2014-15. Similarly, For The Assessment Year 2012-13, The Assessee Has Raised An Alternative Plea To Allow Interest U/S 36(1)(Iii) Which Is Also Ground Of Appeal In Assessment Years 2013-14 & 2014-15. For The Assessment Year 2012-13, The Assessee Raised Ground For Allowance Of Deduction Towards Processing Fees & Pre-Payment Charges U/S 24(B) Of The Act. For The Assessment Year 2013-14, The Assessee Has Raised A Ground For Disallowance Of Rs.25,77,78/- Under The Provisions Of Section 14A Of The Act.

For Appellant: Shri K.K.Chythanya, AdvocateFor Respondent: Dr. P.V.Pradeep Kumar, Addl.CIT(DR)
Section 14ASection 24Section 36Section 36(1)(iii)

M/S Mfar Developers Pvt Ltd, Bangalore vs. The Assistat Commissioner of Income Tax Circle-4(1)(2), Bangalore

In the result, the assessee’s appeal for assessment year 2012-13 is partly allowed

ITA 730/BANG/2018[2013-14]Status: DisposedITAT Bangalore24 Apr 2019AY 2013-14

Bench: Shri B.R. Baskaran & Shri Pavan Kumar Gadale1. Ita Nos.1649/Bang/2017 (Assessment Year: 2012-13) 2. Ita No.730/Bang/2018 (Assessment Year: 2013-14) & 3. Ita No.731/Bang/2018 (Assessment Year; 2014-15) M/S.Mfar Developers Pvt. Ltd. No.3, Lavelle Road, Bengaluru-560 001. … Appellant Pan:Aafcm 6271 M Vs. 1-2. Assistant Commissioner Of Income-Tax, Circle 4(1)(2), Bengaluru. 3. Deputy Commissioner Of Income-Tax, Circle 4(1)(2), Bengaluru. … Respondent Appellant By : Shri K.K.Chythanya, Advocate. Respondent By : Dr. P.V.Pradeep Kumar, Addl.Cit(Dr) Date Of Hearing: 22/03/2019 Date Of Pronouncement: 24/04/2019 O R D E R Per Pavan Kumar Gadale, Jm: The Assessee Has Filed Appeals Against Different Orders Of The Cit(A) For Assessment Years 2012-13, 2013-14 & 2014- 15. Ita Nos.1649/Bang/2017 & 730 & 731/Bang/2018 Page 2 Of 16 2. As Far As Ground No.2 In Respect Of Disallowance Of Proportionate Interest U/S 24(B) Of The Income-Tax Act,1961 ['The Act' For Short], The Assessee Has Raised Similar Grounds Of Appeal For Assessment Years 2012-13, 2013-13 & 2014-15. Similarly, For The Assessment Year 2012-13, The Assessee Has Raised An Alternative Plea To Allow Interest U/S 36(1)(Iii) Which Is Also Ground Of Appeal In Assessment Years 2013-14 & 2014-15. For The Assessment Year 2012-13, The Assessee Raised Ground For Allowance Of Deduction Towards Processing Fees & Pre-Payment Charges U/S 24(B) Of The Act. For The Assessment Year 2013-14, The Assessee Has Raised A Ground For Disallowance Of Rs.25,77,78/- Under The Provisions Of Section 14A Of The Act.

For Appellant: Shri K.K.Chythanya, AdvocateFor Respondent: Dr. P.V.Pradeep Kumar, Addl.CIT(DR)
Section 14ASection 24Section 36Section 36(1)(iii)

M/S Mfar Developers Pvt Ltd, Bangalore vs. The Assistant Commissioner of Income Tax Circle-4(1)(2), Bangalore

In the result, the assessee’s appeal for assessment year 2012-13 is partly allowed

ITA 1649/BANG/2017[2012-13]Status: DisposedITAT Bangalore24 Apr 2019AY 2012-13

Bench: Shri B.R. Baskaran & Shri Pavan Kumar Gadale1. Ita Nos.1649/Bang/2017 (Assessment Year: 2012-13) 2. Ita No.730/Bang/2018 (Assessment Year: 2013-14) & 3. Ita No.731/Bang/2018 (Assessment Year; 2014-15) M/S.Mfar Developers Pvt. Ltd. No.3, Lavelle Road, Bengaluru-560 001. … Appellant Pan:Aafcm 6271 M Vs. 1-2. Assistant Commissioner Of Income-Tax, Circle 4(1)(2), Bengaluru. 3. Deputy Commissioner Of Income-Tax, Circle 4(1)(2), Bengaluru. … Respondent Appellant By : Shri K.K.Chythanya, Advocate. Respondent By : Dr. P.V.Pradeep Kumar, Addl.Cit(Dr) Date Of Hearing: 22/03/2019 Date Of Pronouncement: 24/04/2019 O R D E R Per Pavan Kumar Gadale, Jm: The Assessee Has Filed Appeals Against Different Orders Of The Cit(A) For Assessment Years 2012-13, 2013-14 & 2014- 15. Ita Nos.1649/Bang/2017 & 730 & 731/Bang/2018 Page 2 Of 16 2. As Far As Ground No.2 In Respect Of Disallowance Of Proportionate Interest U/S 24(B) Of The Income-Tax Act,1961 ['The Act' For Short], The Assessee Has Raised Similar Grounds Of Appeal For Assessment Years 2012-13, 2013-13 & 2014-15. Similarly, For The Assessment Year 2012-13, The Assessee Has Raised An Alternative Plea To Allow Interest U/S 36(1)(Iii) Which Is Also Ground Of Appeal In Assessment Years 2013-14 & 2014-15. For The Assessment Year 2012-13, The Assessee Raised Ground For Allowance Of Deduction Towards Processing Fees & Pre-Payment Charges U/S 24(B) Of The Act. For The Assessment Year 2013-14, The Assessee Has Raised A Ground For Disallowance Of Rs.25,77,78/- Under The Provisions Of Section 14A Of The Act.

For Appellant: Shri K.K.Chythanya, AdvocateFor Respondent: Dr. P.V.Pradeep Kumar, Addl.CIT(DR)
Section 14ASection 24Section 36Section 36(1)(iii)