Chandulal Patel, Hyd, Hyderabad V. ACIT, Circle-5(1), Hyd, Hyderabad

ITA 1198/Hyd/2016

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 6109 (ITAT-HYDERABAD)
• Duration Of Justice: 5 year(s) 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-B
• Assessment Year: 2009-2010
• Appeal Filed On: 11-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: RAMESH CHAND JAIN
• Keywords: Commercial expediency
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B” : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI S.S.GODARA, JUDICIAL MEMBER I.T.A. No. 1198/HYD/2016 Assessment Year: 2009-10 Chandulal Patel, HYDERABAD [PAN: AAOPP2359P] Vs Asst.Commissioner of Income Tax, Circle-5(1), HYDERABAD (Appellant) (Respondent) For Assessee : Shri Ramesh Chand Jain, AR For Revenue : Shri Subbaraju Penmetsa, DR Date of Hearing : 13-12-2021 Date of Pronouncement : 20-12-2021 O R D E R PER S.S.GODARA, J.M. : This assessee’s appeal for AY.2009-10 arises from the CIT(A)-4, Hyderabad’s order dated 24-06-2016 passed in appeal No.0412/ACIT, Cir.15(1)/13-14/CIT(A)-4/Hyd/2016- 17, involving proceedings u/s.143(3) r.w.s.147 of the Income Tax Act, 1961 [in short, ‘the Act’]. Heard both the parties. Case file perused. 2. The only issue pressed during the course of hearing at the assessee’s behest is that of correctness of both the learned ITA No.1198/Hyd/2016 :- 2 -: lower authorities making Section 57(iii) interest disallowance of Rs.12,27,403/- during the course of assessment/re- assessment dt.17-02-2014 and upheld in the CIT(A)’s order. 3. Learned counsel sought to invite our attention to the assessee’s detailed paper book(s) running to 63 pages as well as Section 143(3) assessments in preceding assessment years. He stated that the Assessing Officer has already accepted the very nature of interest claim in all the earlier assessment years and therefore, we ought to adopt judicial consistency. 4. Learned departmental representative has drawn a strong support from the impugned disallowance made in both the lower proceedings. 5. We find no merit in assessee’s stand. It is made clear that we are dealing with an instance of interest disallowance u/s.57(iii) of the Act which has to be proved as to have been “laid out or expended only and exclusively for the purpose of making or earning such income”. We sought to know the clinching nexus between the assessee’s interest income if any which could prove the impugned expenditure as an allowable deduction under the residuary head of on income from ‘other’ sources. There is no such material emerging from the case file. 5.1. Learned counsel lastly contended that the assessee had advanced its interest bearing funds to proprietary concern; as the case may be by following commercial expediency only. It is made clear that such commercial expediency is nowhere a subject matter of Section 57(iii) deduction which was never ITA No.1198/Hyd/2016 :- 3 -: considered in all preceding assessment years. We thus affirm the impugned interest disallowance in above terms. 6. This assessee’s appeal is dismissed. Order pronounced in the open court on 20 th December, 2021 Sd/- Sd/- ( A. MOHAN ALANKAMONY ) ( S.S. GODARA ) ACCOUNTANT MEMBER JUDICIAL MEMBER Hyderabad, Dated: 20-12-2021 TNMM ITA No.1198/Hyd/2016 :- 4 -: Copy to : 1.Chandulal Patel, C/o.Ch.Parthasarathy & Co., Sowbhagya Avenue, StreetNo.1, Ashoknagar, Hyderabad. 2.The Asst.Commissioner of Income Tax, Circle-5(1), Hyderabad. 3.CIT(Appeals)-4, Hyderabad. 4.Pr.CIT-4, Hyderabad. 6 5.D.R. ITAT, Hyderabad. 6.Guard File.