TaxTMI 
TaxTMI 
2019 (10) TMI 433
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....quires no adjudication. 3. Ground no.-2 is raised challenging the action of CIT(A) in confirming the addition made on account of payment of interest in the facts and circumstances of the case. 4. Heard both parties and perused the materials available on record. 5. It is noted from the record that the assessee has a property in Park Street which was let out for commercial purposes. The assessee claimed deduction on payment of interest on a loan availed from Vijaya Bank. According to AO a sum of Rs. 2,00,00,000/- was paid to M/s. Abiskar Corporation on 07.04.2006 for seeking surrender of tenancy right of a shop bearing no. 20K, Park Street, Kolkata. The balance Rs. 1,00,00,000/- stated to have been utilized for repair and renovation of ....
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....r vacating the property. From the fact it is clear that the borrowed fund has been used for paying compensation to the tenant. The AO has further observed that the payment of compensation to get property vacated is capital in nature. Hence, interest expenses towards capital expenditure are not allowable expenditure. On the contrary the appellant has simply stated that "The loan was taken to pay off an old tenant against surrender of its tenancy and consequential extensive internal repairs after the vacation to make it ready of letting out again and income offered to tax accordingly. The said loan was utilized wholly and exclusively for this specific purpose. Extensive internal repairs of the existing commercial property were carried on s....
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....ection 24(a) and it is also not in the ambit of section 24(b). I do not find any infirmity with the order of the AO. Hence, the action taken by the AO regarding disallowance of the case is upheld and the appeal of the appellant is dismissed on this ground." 6. On perusal of the reasons given by the CIT(A) along with the submissions made by the Ld. AR we find that the assessee computed the income earning from the said property under the head income from house property. The deductions allowable from income from house property are contemplated U/s 24 of the Act. There is no dispute in granting deduction which is a standard deduction U/s 24(a) of the Act to the assessee. Further, it is noted that the assessee made a claim under Clause (b) of ....
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.... the head income from house property and therefore, the application of deductions contemplated in the Section 57 of the Act does not arise at all, as the deductions are available U/s 57 of the Act if the income chargeable under the head income from other sources. Thus, the submissions of Ld. AR are alternative deduction is not acceptable and are rejected. 8. Coming to the payment of Rs. 2,00,00,000/- to M/s. Aavishkar Corporation and claiming deduction on payment of interest thereon, it is noted that except for agreement between persons representing the said Aavishkar Corporation no such other evidence brought on record like a deed of rental agreement showing that M/s. Aavishkar Corporation is the tenant of assessee and it is noted that t....
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....ties and perused the material available on record. 11. It is noted that the AO found that the assessee debited an amount of Rs. 1,10,300/- under the head brokerage expenses in its profit and loss account. The AO held that when the standard deduction U/s 24 of the Act is granted no other deduction is available under the statute and denied the same. The CIT(A) confirmed the view of AO and the addition made thereon for the reason stated hereunder: "Ground number 3 relates to the adding back an amount of Rs. 1,10,300/- on account of brokerage claim paid by the appellant for procuring tenants on the ground that the standard deduction of 30% has already been allowed out of rental income. This expenditure was claimed under section 57(iii) of ....
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....horities below. There is no dispute granting of standard deduction to the income earned under the head income from house property. The claim of granting deduction U/s 57(iii) of the Act was denied by the CIT(A) only on the ground that the deduction is not permissible under law other than the standard deduction of 30% U/s 24(a) of the Act. Admittedly, an amount of Rs. 1,10,300/- has been debited under the brokerage expenses relating to earning income from house property. Therefore, as rightly pointed by the CIT(A) that the deduction U/s 57(iii) of the Act is not permissible when the assessee availed already standard deduction U/s 24(a) of the Act. Therefore, we find no infirmity in the Order of CIT(A) and it is justified. Ground no.-3 raised....