Rajnish J Karki, New Delhi V. ITO, New Delhi

ITA 3067/DEL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 3561 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 16-05-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KAUSHLENDRA TIWARI
• Assessee Lawyers: S S SILWAL
• Keywords: Depreciation; Business expenditure; Rule of consistency; Proportionate interest
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.NO.3067/DEL./2017 ASSESSMENT YEAR 2012-2013 SHRI RAJNISH J. KARKI, L-1/13, HAUZ KHAS ENCLAVE, NEW DELHI 110 016. PAN AJFPK8684C VS. THE INCOME TAX OFFICER, WARD-32(5), CIVIC CENTRE NEW DELHI 110 002. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI S.S. SILWAL, ADVOCATE. FOR REVENUE : SHRI KAUSHLENDRA TIWARI, SR. D.R. DATE OF HEARING : 02.11.2017 DATE OF PRONOUNCEMENT : 08 .11.2017 ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-11, NEW DELHI, DATED 1 ST MARCH, 2017, FOR THE A.Y. 2012-2013. 2. I HAVE HEARD THE LEARNED REPRESENTATIVES OF BOT H THE PARTIES AND PERUSED THE FINDINGS OF THE AUTHORITIES BELOW. 3. THE LEARNED COUNSEL FOR THE ASSESSEE ARGUED THE GROUNDS 3, 4 AND 5 OF THE APPEAL AND STATED THAT REST OF TH E GROUNDS 1, 2, 6, 7 AND 8 ARE GENERAL AND DID NOT PRESS. I, THEREFORE , DISMISS GROUND 2 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. NOS. 1, 2, 6, 7 AND 8 BEING NOT PRESSED. THE EFFECT IVE GROUNDS OF APPEALS ARGUED BY LEARNED COUNSEL FOR THE ASSESSEE I.E., GROUND NOS. 3, 4 AND 5 ARE REPRODUCED AS UNDER : 3. THAT LD. CIT(A) HAS ERRED SERIOUSLY IN LAW AND FACTS IN CONFIRMING THE DISALLOWANCE OF DEPRECIATION OF RS.5 2,015/- IN RESPECT OF FURNITURE AND FIXTURES IN THE OFFICE AT RANIKHET OFFICE AND ALSO ERRED IN ALLOWING ONLY RS.23,067/- (8.31% OF RS.2,77,578/-) IN RESPECT TO DELHI OFFICE. 4. THAT LD. CIT(A) HAS ERRED SERIOUSLY IN LAW AND F ACTS IN ALLOWING ONLY RS.3,06,706/- AS AGAINST RS.36,90,804 /- BEING THE INTEREST ON LOAN ON OFFICE/HOME LOAN PAID TO M/S. DEWAN HOUSING FINANCE CORPORATION LTD. 5. THAT LD. CIT(A) HAS ERRED IN CONFIRMING AND UPHO LDING THE DISALLOWANCE OF RS.1,83,856/- BEING THE SERVICE TAX PAID BY THE APPELLANT DURING THE YEAR UNDER CONSIDERATION. 4. ACCORDING TO THE REGISTRY, THE APPEAL IS TIME B ARRED BY 13 DAYS. THE ASSESSEE MOVED AN APPLICATION FOR CONDONA TION OF DELAY. IT IS EXPLAINED THAT THE IMPUGNED ORDER WAS RECEIVED O N 04 TH MARCH, 2017, BUT THE IMPUGNED ORDER WAS PLACED BY PEON ON A DIFFERENT FILE. IT WAS ONLY AFTER SOME SEARCH IN THE ENTIRE OFFICE RECORD, THE IMPUGNED ORDER WAS FOUND AND APPEAL WAS IMMEDIATELY FILED. CONSIDERING THE NOMINAL DELAY IN FILING THE APPEAL IN THE LIGHT OF 3 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. EXPLANATION OF ASSESSEE, I AM SATISFIED WITH THE EX PLANATION OF ASSESSEE THAT ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE IN NOT FILING THE APPEAL WITHIN THE LIMITATION. I, ACCORDINGLY, C ONDONE THE DELAY IN FILING THE APPEAL. 5. BRIEFLY THE FACTS OF THE CASE ARE THAT ASSESSEE FILED RETURN OF INCOME DECLARING INCOME AT RS.3,29,689. THE ASSE SSEE IS ENGAGED IN THE PROFESSION OF CONSULTANCY, DESIGNING STRATEG Y AND ORGANISATION DURING THE YEAR. THE ASSESSEE IS HAVIN G REVENUE FROM PROFESSIONAL FEES AMOUNTING TO RS.50,66,906 IN THE YEAR UNDER APPEAL. THE ASSESSEE IS PROVIDING PROFESSIONAL SERV ICES PERSONALLY. HE HAS NEITHER EMPLOYED ANY PROFESSIONAL STAFF NOR HIR ED PROFESSIONAL SERVICES FROM OUTSIDE. THE SALARY PAID TO THE STAFF IS RS.1,05,400 ONLY TO OFFICE BOY/CHOWKIDAR ETC. THE ASSESSEE IS HAVING FOLLOWING IMMOVABLE PROPERTIES SHOWN IN FIXED ASSETS SCHEDULE ON WHICH HE HAS CLAIMED DEPRECIATION. SL.NO. PARTICULARS WDV AS ON 01.04.2011 DEPRECIATION WDV AS ON 31.03.2012 1. PLOT AT RANIKHET 15,01,983/ - NIL 15,01,983/ - 2. OFFICE AT RANIKHET 10,40,302/ - 52,015/ - 9,88,287/- 3. OFFICE PREMISES 27,75,781 / - 2,77,578/ - 24,98,203/ - 4 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. 5.1. IN THE BALANCE SHEET, ASSESSEE HAS SHOWN UNDE R OFFICE/HOME RS.3.75 CRORES AGAINST WHICH HE HAS TAK EN HOME LOAN FROM M/S. DIWAN HOUSING FINANCE CORPORATION LTD., N EW DELHI IN JOINT NAME OF HIMSELF AND HIS WIFE SMT. MANISHA KAR KI AND PAID INTEREST ON OFFICE/HOME LOAN RS.36,90,804 WHICH CON STITUTE 77.97% OF THE TOTAL BUSINESS EXPENSES OF RS.47,33,645 CLAI MED AS PER P & L A/C. THE SAID HOUSE PROPERTY IS RESIDENTIAL HAVING PLINTH AREA OF 279 SQ. METRES OUT OF TOTAL PLOT AREA OF 625 SQ. METRES IN JOINT NAME OF THE ASSESSEE AND HIS WIFE PURCHASED ON 1 ST SEPTEMBER, 2009. THE ASSESSEE ADMITTED THAT HE IS ALSO RESIDING IN PORTI ON OF THIS HOUSE NO.L-1/13, HAUZ KHAS ENCLAVE, NEW DELHI. AS PER NAT URE OF PROFESSIONAL SERVICES PROVIDED BY THE ASSESSEE, THE A.O. WAS OF THE VIEW THAT ASSESSEE REQUIRES ONLY ONE TABLE, ONE CHA IR AND ONE ALMIRAH FOR RUNNING HIS OFFICE. HOWEVER, HE HAS SHOWN THREE OFFICES, ONE AT RANIKHET, ONE OFFICE PREMISES MENTIONED IN THE FIXE D ASSETS SCHEDULE AND OFFICE/HOME MENTIONED IN THE BALANCE SHEET WHIC H INDICATE THAT ALL PERSONAL IMMOVABLE PROPERTIES OWNED BY THE ASSE SSEE AND HIS WIFE ARE PERSONAL IN NATURE BUT HAVE BEEN SHOWN AS BUSIN ESS ASSETS ONLY FOR THE PURPOSE OF EVADING INCOME TAX BY CLAIMING D EPRECIATION AND BUSINESS EXPENSES ETC. THE A.O. ALSO NOTED THAT ASS ESSEE IS HAVING 5 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. ONLY 05 CLIENTS FROM WHOM HE HAS RECEIVED PROFESSIO NAL FEES DURING THE YEAR. THE A.O. THEREFORE, NOTED THAT PROPERTY N O.L-1/13, HAUZ KHAS ENCLAVE IS PERSONAL RESIDENTIAL HOUSE PROPERTY FOR ASSESSEE AND ACCORDINGLY, INTEREST CLAIMED ON LOAN FOR HOUSE PRO PERTY AMOUNTING TO RS.36,90,804 WAS DISALLOWED. THE A.O. ALSO DISAL LOWED DEPRECIATION ON OFFICE AT RANIKHET OF RS.52,015 AND DEPRECIATION ON OFFICE PREMISES OF RS.2,77,578 AND ADDED BACK THE S UM OF RS.3,29,539 TO THE INCOME OF THE ASSESSEE. 6. THE A.O. ALSO NOTED THAT ASSESSEE HAS CLAIMED S ERVICE TAX AMOUNTING TO RS.1,83,856 AS BUSINESS EXPENSES AGAIN ST RECEIPT OF PROFESSIONAL FEES OF RS.50,66,906. THE SERVICE TAX @ 12.36% ON PROFESSIONAL RECEIPTS WOULD COME TO RS.5,57,360. NO SERVICE TAX RETURN WERE PRODUCED IN SPITE OF GIVING NUMBER OF O PPORTUNITIES TO THE ASSESSEE. THE A.O. IN THE ABSENCE OF ANY EVIDEN CE DISALLOWED SERVICE TAX AND MADE THE ADDITION OF RS.1,83,856. 7. THE ASSESSEE CHALLENGED THE ADDITIONS BEFORE TH E LD. CIT(A). THE WRITTEN SUBMISSIONS OF ASSESSEE WERE RE PRODUCED IN THE IMPUGNED ORDER IN WHICH THE ASSESSEE BRIEFLY REITER ATED THE SAME FACTS AS PLEADED BEFORE A.O. AND IT WAS ALSO EXPLAI NED THAT ASSESSEE 6 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. IS PROVIDING CONSULTANCY SERVICES AND ADVISED ON ST RATEGY OF MEDIUM AND LARGE ORGANISATIONS, ON THEIR GROWTH AND PERFOR MANCE IMPROVEMENTS. THE ASSESSEE CHARGED CONSULTANCY FEES AND MAINTAIN OFFICE FOR THE SAME PURPOSE. THE CLAIM OF THE ASSES SEE HAS BEEN ACCEPTED BY THE DEPARTMENT IN PAST YEAR AFTER YEAR. THE ASSESSEE PURCHASED THE PROPERTY NO.L-1/3, HAUZ KHAS ENCLAVE, NEW DELHI, IN THE JOINT NAME ALONG WITH HIS WIFE BUT ENTIRE SALE CONSIDERATION IS PAID BY HIM IN HIS NAME. IT BEING A GOVERNMENT POLI CY, THE JOINT NAME OF HIS WIFE HAS BEEN ADDED. THE INTEREST AND DEPREC IATION, IS THEREFORE, ALLOWABLE. 7.1. THE LD. CIT(A) NOTED THAT ASSESSEE HAS STATED THAT HE HAS NOT CLAIMED DEPRECIATION ON OFFICE PREMISES BUT THE DEPRECIATION REFERRED TO IN THE SCHEDULE OF FIXED ASSETS PERTAIN S TO THE FURNITURE AND FIXTURES. THE ASSESSEE WAS DIRECTED TO CLARIFY AS TO WHICH FURNITURE AND FIXTURE ARE BEING REFERRED. THE ASSES SEE HAS NOT BEEN ABLE TO CLARIFY THIS ISSUE AND HAS ONLY INSISTED TH AT DEPRECIATION HAS NOT BEEN CLAIMED ON OFFICE PREMISES BUT SAME HAS BE EN CLAIMED ON FURNITURE AND FIXTURES. THE LD. CIT(A) ON PERUSAL O F THE SCHEDULE OF FIXED ASSETS FOUND THAT ASSESSEE HAS CLAIMED DEPREC IATION ON OFFICE 7 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. AT RANIKHET @ 5%, OFFICE PREMISES @ 10%, AIR-CONDIT IONER @ 15%, MOTOR CAR @ 15%, OFFICE EQUIPMENT @ 15% AND COMPUTE R @ 60%. THE A.O. IN THE REMAND REPORT STATED THAT ASSESSEE CLAI MED DEPRECIATION ON OFFICE PREMISES AND DURING THE PHYSICAL INSPECTI ON, ONE TABLE, ONE SOFA, ONE ALMIRAH, ONE CUP-BOARD AND LAPTOP AND ONE CHAIR WERE PRESENT IN THE OFFICE PREMISES AT THE TIME OF VISIT ON 20 TH JANUARY, 2017 AND HENCE, ASSESSEES CLAIM THAT DEPRECIATION OF RS.2,77,578/- WAS FOR FURNITURE AND FIXTURE CANNOT BE ACCEPTED. T HE A.O. ALSO CONFIRMED THAT DEPRECIATION IS CLAIMED FOR OFFICE A T RANIKHET AS PER THE SCHEDULE OF DEPRECIATION. THE LD. CIT(A) CONSID ERING THE FACTS OF THE CASE IN THE LIGHT OF REMAND REPORT AND SCHEDULE OF THE DEPRECIATION, FOUND THAT ASSESSEE HAS CLAIMED DEPRE CIATION ON BUILDING. THE LD. CIT(A) ALSO NOTED THAT ASSESSEE H AS NOT BEEN ABLE TO ESTABLISH THAT RANIKET PREMISES WAS BEING USED F OR OFFICE PURPOSES, THEREFORE, DISALLOWANCE OF DEPRECIATION FOR RANIKHE T OFFICE WAS CONFIRMED. THE LD. CIT(A) AS REGARDS DEPRECIATION F OR OFFICE/ RESIDENTIAL PREMISES AT L-1/13, HAUZ KHAS ENCLAVE, NEW DELHI NOTED THAT A.O. DISALLOWED DEPRECIATION AGAINST THE SAID PREMISES SINCE THE SAID PREMISES HAVE BEEN USED FOR PERSONAL/RESIDENTI AL PURPOSE ONLY. THE LD. CIT(A) ON THE ISSUE OF DISALLOWANCE OF INTE REST FOUND THAT THIS 8 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. PROPERTY HAS BEEN USED BY THE ASSESSEE FOR OFFICE/B USINESS ONLY TO THE EXTENT OF 8.31%, THEREFORE, TO THE SAME EXTENT, DEPRECIATION WAS ALLOWED IN A SUM OF RS.23,067 AND BALANCE OF RS.2,5 4,511 WAS DISALLOWED. THE LD. CIT(A) AS REGARDS DISALLOWANCE OF INTEREST ON LOAN CLAIMED FOR OFFICE PURPOSE FORWARDED WRITTEN SUBMIS SIONS AND DOCUMENTS FURNISHED BY THE ASSESSEE AT APPELLATE ST AGE TO THE A.O. AND A.O. WAS DIRECTED TO PERSONALLY VERIFY THE FACT UAL POSITION BY MAKING THE INSPECTION OF THE PROPERTY SO AS TO DETE RMINE THE ACTUAL USE OF THE PROPERTY. THE A.O. SUBMITTED A REMAND RE PORT IN WHICH THE A.O. ON INSPECTION OF THE PROPERTY IN QUESTION SUBM ITTED THAT ASSESSEE IS HAVING ONE ROOM WITH SMALL PANTRY, ONE TOILET FOR OFFICE USE ON NORTH EAST SIDE AT GROUND FLLOR OF L-1/13, H AUZ KHAS ENCLAVE, NEW DELHI WITH SEPARATE ENTRY WHICH IS USED FOR OFF ICE PURPOSE ONLY. THE ABOVE SAID PORTION USED FOR OFFICE PUROSE IS 24 9.66 SQ. FEET OUT OF TOTAL AREA OF THE GROUND FLOOR OF 1714.16 SQ. FEET WHICH COMES TO 14.58% OF THE GROUND FLOOR. BALANCE IS RESIDENTIAL PORTION HAVING SEPARATE ENTRY UTILIZED BY THE ASSESSEE FOR RESIDEN TIAL PURPOSE. MOREOVER, THERE IS NO WAY INSIDE TO ENTER FROM OFFI CE SIDE TO RESIDENTIAL SIDE. THE ASSESSEE IS SHOWING OFFICE PREMISES IN TH E ABOVE SAID PREMISES IN SCHEDULE OF FIXED ASSETS FILED DURING T HE COURSE OF 9 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. ASSESSMENT PROCEEDINGS WHICH IS ANOTHER PROOF FOR T HE SAID OFFICE ASSET AND ALSO CLAIMED DEPRECIATION @ 10% FOR RS.2, 77,578 UNDER THE HEAD OFFICE PREMISES. THE REMAND REPORT WAS CONFR ONTED TO THE ASSESSEE WHO HAS FILED THE REJOINDER. THE ASSESSEE EXPLAINED THAT DUE TO PRIVACY, THE STAFF GUEST MEETING AND CONFERENCE AREA HAVE BEEN SEPARATED. 7.2. THE LD. CIT(A) CONSIDERING THE EXPLANATION OF ASSESSEE IN THE LIGHT OF REMAND REPORT ON RECORD NOTED THAT IT IS NOT IN DISPUTE THAT PROPERTY NO.L-1/13, HAUZ KHAS ENCLAVE IS BEING USED BY THE ASSESSEE FOR BOTH HIS OFFICE AS WELL AS RESIDENTIAL PURPOSE. THE ASSESSEE HAS TAKEN LOAN ON THIS PROPERTY AND WAS PA YING INTEREST ON THE SAME AND CLAIMING AS BUSINESS EXPENSES. IT IS, THEREFORE, AN ADMITTED FACT THAT THE PROPERTY IS BEING USED FOR R ESIDENTIAL PURPOSE AND AS SUCH PROPORTIONATE INTEREST SHALL HAVE TO BE DISALLOWED. AS PER THE REMAND REPORT, THE ASSESSEE USED ONLY 249.6 6 SQ. FEET OF THE PREMISES FOR BUSINESS PURPOSE ONLY. THEREFORE, INTE REST COULD BE ALLOWED TO THAT EXTENT ONLY TO THE ASSESSEE. THE LD . CIT(A) REJECTED THE CONTENTION OF ASSESSEE AS REGARDS INTEREST ALLO WED BY THE DEPARTMENT IN EARLIER YEARS. THE LD. CIT(A) ACCORDI NGLY FOUND THAT 10 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. SINCE OFFICE AREA CONSTITUTE 8.31% OF THE TOTAL ARE A, THEREFORE, INTEREST AMOUNTING TO RS.3,06,704 WAS ALLOWED AS BUSINESS EX PENDITURE AND BALANCE AMOUNT OF RS.33,84,098 WAS DISALLOWED. 8. AS REGARDS THE SERVICE TAX, THE ASSESSEE SUBMIT TED BEFORE THE LD. CIT(A) THAT SERVICE TAX FILES ARE NOT TRACE ABLE. HOWEVER, ASSESSEE FILED THE BANK CERTIFICATE FROM AXIS BANK CONFIRMING THE PAYMENT OF SERVICE TAX. THEREFORE, ADDITION MAY BE DELETED. THE LD. CIT(A) NOTED THAT ASSESSEE DID NOT PRODUCE ANY EVID ENCE OF PAYMENT OF SERVICE TAX. NO COPIES OF RETURN/CHALLAN HAVE BE EN PRODUCED. THE BANK CERTIFICATE PRODUCED DID NOT CONFIRM WHETHER I T WAS SERVICE TAX OR PENALTY PAID OR WHETHER IT WAS PAID FOR PROFESSI ONAL WORK. IN THE ABSENCE OF ANY EVIDENCE ON RECORD, THE LD. CIT(A) C ONFIRMED THE DISALLOWANCE OF SERVICE TAX ALSO. 9. AFTER CONSIDERING THE RIVAL CONTENTIONS, I DO N OT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE. THE LEARNED CO UNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND SUBMITTED COPY OF THE ASSESSMENT ORDER UN DER SECTION 143(3) DATED 19 TH MARCH, 2013 FOR A.Y. 2010-2011 ALONG WITH COPY OF THE ACKNOWLEDGMENT OF THE RETURN OF INCOME AND INCO ME AND 11 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. EXPENDITURE ACCOUNT TO SHOW THAT INTEREST ON OFFICE /HOME LOAN HAVE NOT BEEN DISALLOWED BY A.O. IN A.Y. 2010-2011. HE H AS SUBMITTED THAT EVEN DEPRECIATION HAS NOT BEEN DISALLOWED. HE HAS, THEREFORE, SUBMITTED THAT INTEREST AND DEPRECIATION MAY BE ALL OWED IN FULL DEDUCTION. 10. ON THE OTHER HAND, LD. D.R. RELIED UPON THE OR DERS OF THE AUTHORITIES BELOW. 11. IN THE ASSESSMENT YEAR UNDER APPEAL, THE A.O. DISALLOWED THE ENTIRE INTEREST AND DEPRECIATION BECAUSE THE PR OPERTY WAS FOUND RESIDENTIAL AND WAS NOT USED FOR THE PURPOSE OF OFF ICE/PROFESSION. THE SUBMISSIONS OF THE ASSESSEE AND DOCUMENTS WERE FORW ARDED TO THE A.O. AT APPELLATE STAGE FOR FACTUAL VERIFICATION OF USE OF THE PROPERTY FOR BUSINESS PURPOSE OR NOT. THE A.O. GAVE HIS REMA ND REPORT AFTER PHYSICAL INSPECTION OF THE PROPERTY IN QUESTION AND SUBMITTED THAT ASSESSEE IS HAVING ONE ROOM WITH SMALL PANTRY AND O NE TOILET FOR OFFICE USE ON NORTH-EAST SIDE AT GROUND FLOOR OF THE PROPE RTY. THIS FACT HAS NOT BEEN DISPUTED BY THE ASSESSEE THROUGH ANY EVIDE NCE OR MATEIRAL ON RECORD. DURING THE ASSESSMENT YEAR UNDER APPEAL THE ASSESSEE WAS HAVING TOTAL PROFESSIONAL FEES RECEIPTS OF RS.5 0,66,906 AND OUT 12 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. OF THE SAME, HE HAS DECLARED MEAGRE TAXABLE INCOME OF RS.3,29,689. ASSESSEE WAS NOT MAINTAINING ANY EMPLOYEE AND DID N OT HIRE ANY PROFESSIONAL STAFF FOR EARNING OF SUCH INCOME. THE INTEREST IS THE ONLY MAJOR COMPONENT WHICH IS CHARGED IN P & L A/C AS DE DUCTION. THE ASSESSEE IS HAVING ONLY 05 CLIENTS DURING THE YEAR FROM WHOM HE HAS RECEIVED PROFESSIONAL FEES. THESE FACTS STRENGTHEN THE FINDINGS OF THE A.O. THAT FOR SUCH A SMALL CONSULTANCY WORK, THE AS SESSEE IS REQUIRED ONLY ONE TABLE, ONE CHAIR AND ALMIRAH FOR HIS OFFIC E PURPOSE BECAUSE ONLY ONE ROOM AT GROUND FLOOR HAVE BEEN USED FOR TH E PURPOSE OF BUSINESS. THEREFORE, THE LD. CIT(A) ON PROPER APPRE CIATION OF FACTS AND CONSIDERING THE INSPECTION REPORT OF THE A.O. C ORRECTLY CAME TO THE FINDING THAT ONLY 8.31% OF THE TOTAL AREA OF TH E RESIDENTIAL PROPERTY HAVE BEEN USED FOR OFFICE/BUSINESS PURPOSE . 12. THE LEARNED COUNSEL FOR THE ASSESSEE RELIED UP ON THE ASSESSMENT ORDER FOR A.Y. 2010-2011 TO SHOW THAT A. O. DID NOT DISALLOW DEPRECIATION AND INTEREST. IT MAY BE NOTED HERE THAT THE A.O. DID NOT CONSIDER THE ISSUE OF INTEREST ON DEPRECIAT ION IN HIS ORDER UNDER SECTION 143(3). IT IS A BRIEF ORDER PASSED BY HIM WITHOUT REFERENCE TO DEDUCTION OF THE INTEREST AND DEPRECIA TION. FURTHER, THE 13 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. FACTS ARE TOTALLY DIFFERENT IN ASSESSMENT YEAR UNDE R APPEAL BECAUSE A.O. WAS DEPUTED TO MAKE FACTUAL INSPECTION OF THE PROPERTY IN QUESTION TO JUSTIFY THE CLAIM OF THE ASSESSEE OF US E OF THE RESIDENTIAL PROPERTY FOR BUSINESS PURPOSE ONLY. THIS FACT WAS N OT CONSIDERED IN A.Y. 2010-2011. THEREFORE, WHEN NEW FACTS HAVE BEEN BROUGHT ON RECORD, THE RULE OF CONSISTENCY WOULD NOT APPLY IN THE FACTS AND CIRCUMSTANCES OF THE CASE. CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES, IN THE LIGHT OF FINDINGS OF THE AUTH ORITIES BELOW, I AM OF THE VIEW THAT THE LD. CIT(A) CORRECTLY DISALLOWE D THE BALANCE AMOUNT OF INTEREST OF RS.33,84,098 AS HAVING BEEN I NCURRED FOR PURPOSE OTHER THAN THAT OF BUSINESS. THE DEPRECIATI ON ON SAME ANALOGY FOR SUM OF RS.2,54,511/- WAS RIGHTLY DISALL OWED. THE LD. CIT(A) ALSO NOTED THAT ASSESSEE DID NOT PRODUCE ANY EVIDENCE THAT RANIKHET PREMISES IS USED FOR THE PURPOSE OF BUSINE SS. THEREFORE, DEPRECIATION HAVE BEEN CORRECTLY DISALLOWED. GROUND NOS.3 AND 4 OF APPEAL OF ASSESSEE ARE ACCORDINGLY DISMISSED. 13. AS REGARDS DISALLOWANCE OF SERVICE TAX, THE AS SESSEE DID NOT PRODUCE ANY EVIDENCE BEFORE AUTHORITIES BELOW TO JU STIFY HIS CLAIM OF DEDUCTION. NO COPY OF THE RETURN AND CHALLAN OF PAY MENT OF SERVICE 14 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. TAX HAVE BEEN FILED. THEREFORE, CLAIM OF ASSESSEE C ANNOT BE VERIFIED WHETHER SERVICE TAX IS PAID FOR PROFESSIONAL RECEIP TS EARNED BY THE ASSESSEE IN ASSESSMENT YEAR UNDER APPEAL. A.O. ALSO NOTED THAT THE TOTAL SERVICE TAX PAYABLE BY THE ASSESSEE COMES TO RS.5,57,360 BUT ASSESSEE CLAIMED PAYMENT OF RS.1,83,856. THEREFORE, FACTS WERE NOT VERIFIABLE FROM THE EXPLANATION OF ASSESSEE. THE AS SESSEE FILED COPY OF THE BANK CERTIFICATE OF AXIS BANK BEFORE LD. CIT(A) WHICH ALSO DID NOT REVEAL ANYTHING IN FAVOUR OF THE ASSESSEE. THE ASSE SSEE HAS FILED COPY OF THE BANK CERTIFICATE FROM AXIS BANK WHICH ONLY C ONFIRM THAT ASSESSEE PAID SERVICE TAX PAYMENT. BUT IT IS NOT CL ARIFIED AS TO ON WHICH PROFESSIONAL INCOME ASSESSEE HAS PAID THE SER VICE TAX. IN THE ABSENCE OF CLARIFICATION OF THE PAYMENT OF SERVICE TAX FOR EARNING PROFESSIONAL INCOME, NO INTERFERENCE IS CALLED FOR IN THE MATTER. GROUND NO.5 OF APPEAL OF ASSESSEE IS ALSO DISMISSED . 14. IN THE RESULT, APPEAL OF ASSESSEE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT. 1. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DELHI, DATED 08 TH NOVEMBER, 2017 VBP/- 15 ITA.NO.3067/DEL./2017 SHRI RAJNISH J. KARKI, NEW DEL HI. COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASST. REGISTRAR : ITAT DELHI BENCHES : DELHI.