Sh. Rajendra Bhalla, S/o Late Sh. Amarnath Bhalla, Gwalior V. I.T.O., Gwalior

ITA 80/AGR/2013

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 0703 (ITAT-AGRA)
• Duration Of Justice: 6 year(s) 1 month(s) 21 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 23-07-2013
• Assessment Year: misc
• Appeal Filed On: 25-03-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S D SHARMA
• Assessee Lawyers: NAVIN GARGH
• Keywords: Business income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 80/AGRA/2013 ASSTT. YEAR : 2007-08 SHRI RAJENDRA BHALLA, VS. INCOME TAX OFFICER(TEC H.) S/O LAT SHRI AMARNATH BHALLA, GWALIOR. 101-102, SHIVAM APARTMENT, KAMLESHWAR COLONY, JIWAJI GANJ, GWALIOR. (PAN: ABEPB 9653 B) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI NAVIN GARGH, ADVOCATE RESPONDENT BY : SHRI S.D. SHARMA, SR. D.R. DATE OF HEARING : 23.07.2013 DATE OF PRONOUNCEMENT OF ORDER : 26.07.2013 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A), GWALIOR DATED 22.01.2013 FOR THE ASSESSMENT YEAR 20 07-08, CHALLENGING THE ADDITION OF RS.96,626/- ON ACCOUNT OF DISALLOWANCE OF INTEREST PAID TO LIC HOUSING. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSE SSEE FILED RETURN OF INCOME AT RS.3,30,871/-. THE ASSESSEE STATED BEFORE THE AO TH AT HE DOES NOT MAINTAIN ANY ITA NO. 80/AGRA/2013 2 BOOKS OF ACCOUNT AND RETURN OF INCOME IS FILED UNDE R THE PROVISIONS OF SECTION 44AF. THE AO, HOWEVER, REJECTED THE BOOK RESULTS U/ S. 145(3) BECAUSE NO BOOKS OF ACCOUNT WERE PRODUCED AND MADE ADDITION OF RS.2,63, 610/-. THE LD. CIT(A) DELETED THIS ADDITION BECAUSE THE ASSESSEE FILED RETURN OF INCOME U/S. 44AF OF THE IT ACT. IT WAS NOT EXPLAINED AS TO HOW THE CLAM OF ASSESSEE WA S INCORRECT IN ANY MANNER. THE ADDITION OF RS.2,63,610/- MADE TO THE BUSINESS INC OME OF THE ASSESSEE HAS BEEN ACCORDINGLY DELETED. 3. THE ASSESSEE IN THE PROFIT AND LOSS ACCOUNT FURT HER CLAIMED DEDUCTION OF RS.96,626/- ON ACCOUNT OF INTEREST PAID TO LIC OF I NDIA. THE LOAN WAS TAKEN FROM LIC FOR HOUSE CONSTRUCTION AND THE SAME PROPERTY WA S ALSO SOLD DURING THE YEAR UNDER CONSIDERATION. THE AO, THEREFORE, DISALLOWED RS.96,626/-. THE LD. CIT(A) ALSO NOTED THAT THE LOAN WAS TAKEN FROM LIC FOR RES IDENTIAL HOUSE PROPERTY, WHICH HAS BEEN SOLD DURING THE YEAR UNDER CONSIDERATION. THE LD. CIT(A) ALSO NOTED THAT THE INTEREST WAS PAID BY THE ASSESSEE IN RESPECT OF LOAN TAKEN FOR CONSTRUCTION/RENOVATION OF SELF-OCCUPIED PERSONAL R ESIDENTIAL PROPERTY. THEREFORE, SUCH CLAIM IS NOT MAINTAINABLE AGAINST THE BUSINESS INCOME. THE APPEAL OF THE ASSESSEE ON THIS GROUND WAS ACCORDINGLY DISMISSED. ITA NO. 80/AGRA/2013 3 4. THE LD. COUNSEL FOR THE ASSESSEE REFERRED TO PB- 13, WHICH IS TRADING AND PROFIT AND LOSS ACCOUNT, IN WHICH THE ASSESSEE MADE CLAIM OF DEDUCTION OF INTEREST PAID TO LIC AND LOAN IS SHOWN IN THE BALANCE SHEET. HE HAS ADMITTED THAT RETURN OF INCOME WAS FILED U/S. 44AF OF THE IT ACT. HE HAS, H OWEVER, SUBMITTED THAT SINCE LOAN IS SHOWN IN THE BALANCE SHEET, THEREFORE, INTE REST IS ALLOWABLE DEDUCTION. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDERS O F THE AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND DO NOT FIND ANY MERIT IN THIS GROUND OF APPEAL OF THE ASSESSEE. THE ASSESSEE ADMI TTED BEFORE THE AO THAT NO BOOKS OF ACCOUNT HAVE BEEN MAINTAINED BECAUSE THE A SSESSEE IS A RETAILER AND RETURN OF INCOME HAS BEEN FILED UNDER THE PROVISION OF SEC TION 44AF. THIS FACT WAS ALSO SUBMITTED BEFORE THE LD. CIT(A). THEREFORE, THE LD. CIT(A) DELETED THE ADDITION ON ACCOUNT OF EXTRA PROFIT IN A SUM OF RS.2,63,610/-. ONCE THE INCOME IS DECLARED AND ESTIMATED BY THE ASSESSEE AS DECLARED U/S. 44AF, TH E ASSESSEE WOULD NOT BE ENTITLED FOR FURTHER DEDUCTION OF INTEREST FROM THE INCOME. FURTHER, THE PROFIT AND LOSS ACCOUNT AND BALANCE SHEET MAINTAINED BY THE ASSESSE E WITHOUT BOOKS OF ACCOUNTS CANNOT BE RELIED UPON IN THE ASSESSMENT YEAR UNDER APPEAL. THEREFORE, THE CLAIM OF LD. COUNSEL FOR THE ASSESSEE IS REJECTED. THE ASSES SEE HAS ADMITTEDLY TAKEN LOAN FOR RENOVATION/CONSTRUCTION OF SELF OCCUPIED PERSONAL R ESIDENTIAL HOUSE PROPERTY. THEREFORE, IT HAS NO CONNECTION WITH THE BUSINESS I NCOME OF THE ASSESSEE. THE ITA NO. 80/AGRA/2013 4 PROPERTY WAS ALSO SOLD DURING THE YEAR UNDER CONSID ERATION. THE LD. COUNSEL FOR THE ASSESSEE ADMITTED DURING THE COURSE OF ARGUMENTS TH AT THE HOUSE PROPERTY AGAINST WHICH THE LOAN WAS TAKEN WAS NEVER USED FOR THE PUR POSE OF BUSINESS OF THE ASSESSEE. THEREFORE, PROPERTY BEING NOT USED, ANY I NTEREST PAID FOR SUCH LOAN, COULD NOT BE ALLOWED AS DEDUCTION. IN THIS VIEW OF THE MA TTER, WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE. SAME IS ACCORDINGLY DIS MISSED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY