TaxTMI 
TaxTMI 
2021 (7) TMI 139
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....f Rs. 29,44,430/-. It was noted by him from the assessment record of AY 2016-17, that the assessee had sold a residential flat/apartment on 18.11.2015 at a cost of Rs. 1,64,00,000/- and had computed long term capital gain (LTCG) of Rs. 4,07,178/- taking the date of acquisition of the said property as on 19.03.2006. The Ld. PCIT noted that in the computation of LTCG, the assessee had debited an amount of Rs. 30,38,124/- on account of expenses made directly related to sale of flat. According to him, the amount of Rs. 30,38,124/- was paid on account of repayment of housing loan of Rs. 50,00,000/- availed for purchase of the aforesaid flat; and the Ld. PCIT acknowledged that the assessee had furnished relevant interest certificate for each F.Y. with the submission made during assessment proceedings. However according to Ld. PCIT it appears from the records that the assessee also had availed benefit of deduction u/s. 24(b) of the Act towards interest paid on housing loan in the preceding assessment years prior to the sale of capital asset. According to him, section 48 of the Act does not allow an assessee to avail interest paid on housing loan to be deducted while computing LTCG on sale....
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....set since the expenses on Interest paid is not related to such transfer. In this case, assessee appears to have availed double deduction of Interest on housing loan firstly at the time of furnishing return of Income every year under the head Income of loss from self occupied house property and further at the time of computing LTCG as claiming the same Interest as direct expenses related to transfer of capital asset. The assessee has failed to completely disclose its true and correct income by non-furnishing of details as required under provisions of the I.T. Act, 1961. The A.O. has passed the assessment order without making enquiries or verification which should have been made In the Instant case. Clause (a) & (b) of Explanation 2 to Section 263(1) are attracted in this case. Accordingly, it is held that the assessment order is erroneous insofar as it is prejudicial to the interest of revenue." And thereafter he was pleased to set aside the assessment order and directed the AO to frame the assessment afresh. Aggrieved by the aforesaid action of the Ld. PCIT the assessee is before us. 4. We have heard both the parties and perused the records. Before we advert to the facts and law ....
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.... Assessing Officer adopted one of the courses permissible in law and it has resulted in loss to the revenue, or where two views are possible and the Assessing Officer has taken one view with which the CIT does not agree, it cannot be treated as an erroneous order prejudicial to the interest of the revenue "unless the view taken by the Assessing Officer is unsustainable in law". Keeping the aforesaid legal principle in our mind let us examine the impugned order of the Ld. PCIT as to whether the condition precedent as laid down by the Hon'ble Supreme Court in Malabar Industrial Co. Ltd. vs. CIT reported in [2000] 243 ITR 83 (SC) is satisfied or not. 5. Keeping the case laws discussed (supra) when we examine the legal issue raised by the assessee against the jurisdiction of Ld. PCIT to usurp the revisional jurisdiction u/s 263 of the Act, we note that the main fault which the Ld. PCIT points out in the assessment order is that in the computation of LTCG on the flat sold, the assessee by debiting the total interest of Rs. 30,38,124/- as expenses related to sale of flat which was on account of housing loan of Rs. 50 lacs was double deduction and should not have been allowed by the AO, ....
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....f cost of acquisition because it was in fact interest paid towards repayment of housing loan of Rs. 50 lacs availed for purchase of the flat. This is the factual position. However the Ld. PCIT alleges that, the assessee had claimed the interest on loan as deduction u/s. 24(b) of the Act under the Head 'Income from House Property" in the return of income of the preceding assessment years prior to the sale of the capital asset/flat. By doing so, the assessee had availed double deduction of interest on the housing loan i.e. in the return of income of preceding assessment years (from AY 2006-07 onwards) under the head Income from House Property. According to Ld. PCIT, after having claimed the interest expenditure on the loan availed for the flat, that assessee has again in this assessment year (AY 2016-17) has claimed the same, at the time of computing LTCG by claiming the very same interest as direct expenses relating to transfer of capital asset. Thus, according to Ld. PCIT the AO has erred in allowing the claim of deduction of interest of Rs. 30,38,124/- by passing the assessment order dated 29.11.2018. However, we do not agree with the Ld. PCIT. We find that the assessee has not c....