TaxTMI 
TaxTMI 
2021 (8) TMI 159
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....wance of expenses to the tune of Rs. 1,55,74,455/- relating to residential premises, ignoring the fact that the Ward Inspector who inspected the premises had categorically reported that the said premises was utilized only for residential purpose. (iii) The appellant prays that the order of Ld.CIT(A) on the above grounds be set-aside and that of the assessing officer be restored. As evident, the revenue is aggrieved by deletion of disallowance of Rs. 155.74 Lacs as made by Ld. AO in assessment order dated 29/03/2016. 2. We have carefully heard the rival submissions and perused relevant material on record. The Ld. DR pleaded for restoration of assessment as framed by ld. AO while Ld. AR supported the order of learned first appellate authority. For this, Ld. AR drew our attention to the documentary evidences as well as photographs / audio-visual clips as placed on record. The audio-visual clips were displayed before us and the same were duly appreciated. The Ld. AR also raised a plea that similar expenses were allowed by revenue in earlier years and therefore, disallowing the same in this year would violate the rule of consistency. After due consideration of material facts, our ad....
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....mises was being used as her office and the expenditure was allowable as business expenditure. Therefore, the aforesaid expenditure of Rs. 155.74 Lacs was disallowed while computing the income. Appellate Proceedings 4.1 During appellate proceedings, the assessee produced additional evidences to substantiate her claim that part of the premises was being used as her office. Accordingly, a remand report was sought from Ld.AO. In the remand report, it was reiterated that the assessee did not furnish the information in the suggested format and therefore, the expenses thus claimed by her could not be allowed. The Ld. AO also opposed admission of additional evidences. 4.2 However, the assessee controverted the findings of Ld. AO on the ground that necessary details / information as called were furnished during assessment proceedings and it was well demonstrated that part of the premises at Oberoi Sky Heights was being used for the purpose of profession. It was also explained that the assessee was professional choreographer and she could not perform / carry out professional activities without any office premises. The profession of choreographer would require continuous innovation and pr....
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....on of units during the course of scrutiny assessment proceedings for AY 2012-13 and demonstrated the utilization of these two units for the purpose of profession. The Ld. AO, after due verification / details of units, bifurcated the units into residential use and office use and allowed depreciation as claimed in the return of income with respect to unit nos. 3501B & 3601B. The Ld. AO also allowed proportionate electricity expenses & society charges with respect to these two units. The proportionate interest on loan taken to acquire these units was also allowed. Finally, entire expenditure as claimed in AY 2012-13 against two units was allowed. Therefore, facts being the same in this year, the claim was to be similarly allowed. The assessee also controverted the allegation of non-furnishing of details in the specified format by submitting that details / information submitted before Ld. AO would cover the nature of details and information sought by Ld.AO and therefore, the disallowance was not justified. The assessee also drew attention to the fact that the interior of the two units was designed in such a way that these units would be used exclusively for the purpose of business. ....
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....annot withdraw the relief for subsequent assessment years. Similar was the ratio in CIT v. Arts & Crafts Exports (2012) 246 CTR 463 (Bom); CIT v. Paul Brothers (1995) 216 ITR 548 (Bom), Direct Information (P) Ltd. v. ITO (2011) 203 Taxman 70 (Bom) which had taken the same view. Finally, the impugned additions / disallowances were deleted. Aggrieved as aforesaid the revenue is in further appeal before us. Our findings and Adjudication 6. As is evident from record, the assessee is a creative artist. The assessee was engaged as Choreographer and film producer. For the said purpose, the assessee would require creative space from where she could carry out professional engagements. It could be appreciated that as a Choreographer and a film producer, the assessee would need work space to practice dance moves and also for story sessions and other meetings. In this year, except for this space, she has not claimed any other office set-up. Another fact borne out of the record is that till 2011, the assessee was having similar units at Embassy Tower which were being used as office-cum-residence, in the same manner. The proportionate expenses relating to office in all the earlier years were ....
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....e was used for the purpose of profession. The assessee has claimed depreciation proportionately on that part only which has been used for the purpose of profession. Therefore, the deprecation claim on building and furniture would be an allowable allowance u/s 32. We order so. The grounds, thus raised by revenue, stand dismissed. 9. Regarding interest claim, we find that the provisions of Sec.36(1)(iii) provide for deduction of interest in respect of capital borrowed for the purpose of the business or profession. The interest paid on capital borrowed for acquisition of an asset after the date on which the asset is first put to use is also allowed as deduction. The assessee has borrowed loan from Standard Chartered Bank for acquisition of the said property at Oberoi Sky Heights. The interest paid on such loan has been bifurcated between residential portion and office portion and interest paid relating to office portion has been claimed as deduction. It was the submissions of the assessee that office has been acquired for the purpose of her profession and therefore, loan is borrowed for the purpose of profession. Further, the unit was put to use during financial year 2011-12 relevant....