2024 (9) TMI 132

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....ing used for hiring. 3.(i) On the facts and circumstances of the case, Ld. CIT(A) has erred both on facts and in law in confirming the action of the A.O. in making the addition of Rs. 19,22,524/-, being interest paid on the amount of loan borrowed to purchase the plot. (ii) That the said addition has been made despite the fact that the interest on loan taken to purchase the plot is a part of cost of acquisition. 4. (i) On the facts and circumstances of the case, Ld. CIT(A) has erred both on facts and in law in confirming the action of the A.O. in making the addition of Rs. 2,75,520/- under the head 'income from house property'. (ii) That the addition has been confirmed without considering the facts of the case that the rental income from house property and on cars were shown separately. 5.(i) On the facts and circumstances of the case, Ld. CIT(A) has erred both on facts and in law in enhancing the income of the assessee to the extent of Rs. 39,75,568/- on account of loss incurred on sale of land. 2. Ground no. 1 of grounds of appeal is general nature, hence, called for no adjudication. 3. Ground no. 2 is with respect to disallowanc....

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....ve that in the course of assessment proceedings, the Assessing Officer noticed that the assessee took loan from India Bulls Financial Services Ltd. and paid interest for the financial years 2007- 08 to 2014-15 totaling to Rs. 38,45,048 and the same has been added to the cost of acquisition of the property sold. The Assessing Officer required the assessee to justify its claim and the assessee has replied that he has intended to construct house property on the plot, however, due to unavoidable circumstances, the same could not be constructed and, therefore, the interest was capitalized and added to the cost of acquisition of the property sold in order to claim as expense out of income from house property. Not convinced with the reply, the Assessing Officer referring to the decision of the Mumbai Bench in the case of the Vikram Sadananad Haskote held that interest paid by the assessee for the period commencing from the date of acquisition of assets till the date of sale would not form part of cost of acquisition. Accordingly, interest relating to cost acquisition of assets was disallowed from the cost of acquisition claimed by the assessee. As the assessee as holding 50% of the shares....

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....78.00 on the amount borrowed by her. The amount of Rs. 95,000.00 plus the interest paid by the assessee constitutes the actual cost to the assessed of the land. The fact that the amount of Rs. 95,000.00 was paid by the assessee to the vendor and the amount of interest of Rs. 16,878.00 was paid to a different person, namely, her mother-in-law, does not make any difference so far as the assessee is concerned in respect of the actual cost of the land to her. It will not also make any difference whether the interest was paid on the date of the purchase or whether it is paid subsequently. To exclude the interest amount from the actual cost of the assets would lead to anomalous results. Supposing she had purchased the land for Rs. 1,00,000.00 by raising a loan of that amount and had paid interest of Rs. 20,000.00 on the said loan and had sold the land for Rs. 1,20,000.00. It would be unreasonable to hold under such circumstances by excluding the interest amount from the actual cost of the land that she had made a capital gain of Rs. 20,000.00 when, as a matter of fact, she had not made any profit at all by the transaction. Applying the said observations of the Calcutta and the Bombay Hig....

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....ing to ground no.4 i.e. addition of Rs. 2,75,520, we observe that the Assessing Officer in the assessment order stated that the assessee received rent of Rs. 5,73,600 but has shown rental income of Rs. 1,80,000 only and, therefore, he recalculated the income from house property and made an addition of Rs. 2,75,520 which was sustained by the learned CIT (Appeals). 14. The learned counsel for the assessee submits that the Assessing Officer went wrong in considering the lease income from cars as the rent received on property and computed the income from house property which is not correct. The assessee has separately shown income of Rs. 1,80,000 under the head "income from house property". Therefore, the assumption of the Assessing Officer that assessee has received rent of Rs. 5,73,600 under the head "income from house property" is not correct. 15. Heard rival contentions. On perusal of the computation of income filed at pages 1 to 6, we observe that the assessee has declared income from house property at Rs. 1,80,000 and also declared lease rent from cars of Rs. 5,73,600 under the head "income from other sources". On perusal of the assessment order, we notice that the Assessin....