TaxTMI 
TaxTMI 
2024 (8) TMI 817
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....ct"] for Assessment-Year ["AY"] 2020-21, the assessee has filed this appeal. 2. The precise facts as can be culled out from assessment-order are such that the assessee-individual filed return of income for AY 2020-21 showing a total income of Rs. 82,15,509/- comprising of taxable salary of Rs. 1,21,48,336/-, loss from house-property of Rs. 30,000/-, loss from other sources of Rs. 37,41,259/- and deductions under Chapter VI-A of Rs. 1,61,568/-. The assessee declared loss of Rs. 37,41,259/- from other sources as under: "Income from Other sources (Chapter IV F): Interest from Saving Bank A/c 1,20,315 Interest Item 21,09,764 22,30,079 Less: Interest Paid 5....
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....clusively for the purpose of earning such income. Hence, the variation to the tune of Rs. 82,01,417/- (i.e. Rs. 59,71,338/- + 22,30,079/-) are proposed. Since the assessee has completely failed to discharge the onus cast upon him. 5. Table of variations : S.No. Description Amount (in INR) 1. Income as per Return of income filed 82,15,510/- 2 Income as computed u/s 143(1)(a) 82,15,510/- 3. Variation in respect of issue of disallowance of deduction claimed u/s 57 59,71,338/- 4. Variation in respect of issue of interest income 22,30,079/- 5. Total income/Loss determined as per the above proposal 1,64,16,927/- 4. Aggrieved the assessee carried matter in first-appeal and made subm....
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....ived' filed at Page 7 of Paper- Book and another 'Statement of Interest Paid' filed at Page 8 of Paper-Book to show that the assessee has received interest @ 9/9.5/12% per annum and also paid interest @ 9% per annum (15% per annum/1.25% per month in a few cases). He submitted that broadly the interest rate received and paid by assessee are same except in some cases where the assessee has paid interest at a higher rate of 15% per annum. Placing reliance on Order dated 30.04.2021 of ITAT, Indore in ITA Nos. 87/Ind/2020 & 956/Ind/2019 of Smt. Padma Kalani (case of assessee's family member), Ld. AR submitted that the ITAT allowed deduction of interest paid by assessee at a higher rate of 12% to 15% per annum as against interest received @ 6% pe....
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....attention has been drawn. The issue here is the disallowance of deduction of Rs. 59,71,338/- consisting of Interest expenditure of Rs. 51,28,176/-, Legal expenses of Rs. 7,80,106/-, Bank charges of Rs. 15,736/- and Brokerage of Rs. 47,300/- claimed by assessee against interest income of Rs. 22,30,079/-. Admittedly, the assessee has claimed these deductions u/s 57(iii). The assessee has earned interest income of Rs. 22,30,079/- only but claimed an aggregate deduction of Rs. 59,71,338/- which has resulted into a net loss of Rs. 37,41,259/- ultimately set off against salary income. In terms of legal provision of section 57(iii), the deductions claimed by assessee are allowable only if the relevant expenses have been laid out or expended wholly....
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.... can be higher as compared to interest rate received but first of all the assessee has to prove that the funds on which he has paid interest and claimed deduction were actually utilized for giving loans so as to satisfy the requirement of "wholly and exclusively for the purpose of making or earning income" as per section 57(iii). In present case, there is no submission by assessee to prove this factum. Therefore, the assessee is required to submit clinching particulars to AO in this regard. At the same we also find that the AO has disallowed interest deduction of Rs. 51,28,176/- claimed by assessee fully as if the assessee has not utilized a single pie of borrowed funds for giving loans. Apparently, this approach of AO is also not correct. ....