Smt. Jagrutiben Jambukumr Sheth, Ahmedabad V. The Income tax Officer,Ward-11(1), Ahmedabad

ITA 246/AHD/2012

• Counselvise Citation: 24620514 RSA 2012
• Duration Of Justice: 1 year(s) 10 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-12-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 17-10-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 30-01-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SHUBRATA VERMA
• Assessee Lawyers: HARDIK VORA

Judgement Text

, , , , SMC, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, SMC BENCH . .. . . .. . , !' # ' !' # ' !' # ' !' # ' BEFORE SHRI G.C. GUPTA, VICE-PRESIDENT ITA NO.246/AHD/2012 [ASSTT.YEAR : 2008-2009] SMT. JAGRUTIBEN J. SHETH 305, ARMAN FLAT PANKAJ SOCIETY BHATTA, PALDI, AHMEDABAD 380 007. PAN : AGVPS 0426 P /VS. ACIT, CENT.CIR.1(4) AHMEDABAD. ( (( (%& %& %& %& / APPELLANT) ( (( ('(%& '(%& '(%& '(%& / RESPONDENT) )* + , #/ ASSESSEE BY : SHRI HARDIK VORA . + , #/ REVENUE BY : SMT. SHUBRATA VERMA, DR / + *01/ DATE OF HEARING : 17 TH OCTOBER, 2013 234 + *01/ DATE OF PRONOUNCEMENT : 2-12-2013 #5 / O R D E R THIS APPEAL OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2008-09 IS DIRECTED AGAINST THE ORDER OF THE CIT(A)-XVI, AH MEDABAD DATED 14.11.2011. 2. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ONLY EFFECTIVE GROUND OF THE APPEAL IS GROUND NO.1.1, WH ICH IS REPRODUCED HEREINUNDER: ITA NO.246/AHD/201 -2- 1.1 THAT THE LD.CIT(A) HAS ERRED IN CONFIRMING DISALLOWANCE OF ` 87,140/- BEING INTEREST EXPENSES AND ` 11,574/- U/S.57(III) OF THE ACT. 3. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THIS GROUND OF THE APPEAL OF THE ASSESSEE CONSISTS OF TWO PARTS . FIRST PART IS REGARDING THE DISALLOWANCE OF INTEREST EXPENSES OF ` 87,140/-. HE REFERRED TO RELEVANT PORTIONS OF THE APPELLATE ORDE R PASSED BY THE LEARNED CIT(A) IN PARA 2.1 THEREOF, WHEREIN THE FAC TUAL POSITION OF THE ISSUE HAS BEEN RECORDED BY THE LEARNED CIT(A). HE SUBMITTED THAT ONLY ` 25,342/- OUT OF THE INTEREST PAID COULD BE DISALLO WED, AS THE DISALLOWANCE SHOULD BE DETERMINED ONLY AFTER NETTIN G OFF THE AMOUNT OF LOAN GIVEN AND ACCEPTED FROM THE RELATIVES OF TH E ASSESSEE. HE SUBMITTED THAT THE ASSESSEE HAS PAID AS WELL AS CHA RGED INTEREST FROM HER RELATIVES AND NET BALANCE ONLY COULD BE DISALLO WED. THE TOTAL OF SUCH NET DEBIT AMOUNT COMES TO ` 25,342/- AND THERE IS NO JUSTIFICATION FOR DISALLOWANCE OF ENTIRE INTEREST EXPENSES OF ` 87,140/- TO THESE RELATIVES. THE LEARNED DR HAS RELIED ON THE ORDERS OF THE AO AND THE CIT(A). 4. I HAVE CONSIDERED RIVAL SUBMISSION AND PERUSED T HE ORDERS OF THE AO AND THE CIT(A). I FIND THAT THE ASSESSEE HA S CHARGED AS WELL AS PAID INTEREST TO HER DIFFERENT RELATIVES AND THE DI SALLOWANCE OF INTEREST COULD BE ONLY AFTER NETTING OFF THE AMOUNT OF INTER EST PAID AND CHARGED FROM RELATIVES BY THE ASSESSEE. THE TOTAL OF SUCH DISALLOWANCE OF NETTING OFF OF THE AMOUNT OF INTEREST CHARGED AND P AID TO THE RELATIVES OF THE ASSESSEE COMES TO ` 25,342/-, AND THEREFORE, THE DISALLOWANCE OF INTEREST HAS TO BE RESTRICTED TO ` 25,342/- AND THE ENTIRE AMOUNT OF INTEREST OF ` 87,140/- COULD NOT BE DISALLOWED, AND I DIRECT TH E AO TO ITA NO.246/AHD/201 -3- RESTRICT THE DISALLOWANCE OF INTEREST OF ` 25,342/- AS AGAINST ` 87,140/- DISALLOWED BY HIM. OTHER ISSUE IN THIS GROUND OF THE APPEAL IS REGARD ING DISALLOWANCE OF ` 11,574/- UNDER SECTION 57(III) OF THE ACT. THE LEARNED COUNSEL FOR THE ASSESSEE HAS NOT SERIOUSLY PRESSED THIS ISSUE BEFORE ME, AND IS ACCORDINGLY DISMISSED. ACCORDING LY, THE GROUND OF NO.1.1 OF THE ASSESSEE IS PARTLY ALLOWED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD