TaxTMI 
TaxTMI 
2017 (8) TMI 1662
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....or the sake of convenience. 2. The assessee has raised several grounds in each year but a common grievance is raised in all the 5 years regarding the disallowance made by the AO on account of interest expenditure paid by the assessee u/s. 24B of the IT Act. The amount of disallowance is Rs. 12,61,165/- in Assessment Year 2005-06, Rs. 11,16,912/- in Assessment Year 2006-07, Rs. 9,84,432/- in Assessment Year 2007-08, Rs. 11,47,216/- in Assessment Year 2008-09 and Rs. 11,80,957/- in Assessment Year 2009-10. 3. The assessee has raised 7 identical additional grounds also in each of all these years and the same are reproduced herein below. "1. The learned Commissioner of Income Tax (Appeals) and the learned Assessing Officer, have ....
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.... Tax (Appeals) and the learned Assessing Officer have erred, in law and in facts, by failing to appreciate the fact that the appellant had incurred totally Rs. 70,61,000/- to acquire the let out property by taking loan from KSFC and other lenders as per the financials which was clearly evident in the Balance sheet of the appellant. 6. The learned Commissioner of Income Tax (Appeals) have erred, in facts and in law, by holding that the last instalment of the KSFC loan would have been paid on January 2005 and the Appellant was eligible to claim interest only up to January 2005 without actually appreciating the fact that KSFC loan was not paid as per the originally agreed schedule and it was paid only out of the loan from SBI. ....
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....able u/s. 24B of IT Act. 5. As against this, ld. DR of revenue supported the orders of authorities below. He also placed reliance on the following judgments in support of his contention that when interest paid is on subsequent loan taken for repayment of earlier housing loan, interest u/s. 24 is not allowable:- A. ITO Vs. Satya Co. Ltd. (19 ITD 596(Calcutta)) B. Naman Kumar Vs. CIT (221 Taxman 269) (Punjab & Haryana) 6. In the rejoinder, the ld. AR of assessee placed reliance on the Tribunal order rendered in the case of ACIT Vs. Sunil Kumar Agarwal as reported in 139 TTJ 49 (Lucknow). He filed the copy of this Tribunal order and submitted that this Tribunal order is subsequent to the earlier Tribunal order rendered ....
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....ot complied with these requirements, the assessee is not eligible to claim for the same amount of Rs. 12,61,165/- towards interest on borrowed capital u/s. 24B of the Act. Hence, it is seen that this claim of the assessee that the loan from SBI is for repayment of housing loan earlier borrowed from KSFC is not disputed by the AO in the assessment order. Now in the light of these facts, I examine the applicability of various judgments cited by both sides. As per the Tribunal order cited by ld. DR of revenue having rendered in the case of ITO Vs. Satya Co. Ltd. (supra), it was held that as per the facts of that case, the assessee in that case purchased a house property at Rs. 2.45 lakhs on 22.06.1955 and for this purpose, the assessee made a ....
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....ulsidas Kanoria & Co. and others and only Rs. 20,100/- was repaid out of borrowing from Shri A.K. Kanoria. The assessment year before the Tribunal was 1973-74 whereas the repayment of housing loan was reflected in 1955-56. In view of these facts, in my considered opinion, the facts of the present case are different because in the present case, the repayment of housing loan is out of fresh borrowings and hence in the facts of present case, it cannot be said that the present borrowing on which interest is claimed u/s. 24 is unconnected with the borrowed capital used for acquiring the house property and hence, in my considered opinion, of this Tribunal order cited by ld. DR of revenue is not applicable in the facts of the present case. 8. N....
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....nterest paid on the loan from relatives and IDBI on the ground that the loan taken from HDFC was repaid and there remains no housing loan on said date. Such disallowance was deleted by ld. CIT(A) by holding that the subsequent loan was to repay earlier / original loan and therefore, the interest on subsequent loan taken for repayment of housing loan was eligible for deduction u/s. 24 of IT Act against the income from housing property. On appeal from the department, the Tribunal confirmed the order of CIT(A) and while confirming the order of CIT(A), the Tribunal referred to a CBDT Circular No. 28 dated 20.08.1969 wherein it was specified that if the second borrowing has really been used to repay the original loan and this fact is proved to t....