TaxTMI 
TaxTMI 
2025 (3) TMI 931
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....ted for limited scrutiny under CASS. Accordingly, statutory notices u/s 143(2) and 142(1) of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') were issued and served on the assessee, in response to which the AR of the assessee appeared before the Assessing Officer and filed the requisite details from time to time. 3. During the course of assessment proceedings the Assessing Officer noted that the assessee has showed interest income under the head ' Income from other sources' of Rs. 1,03,18,929/-. Further, the assessee has claimed deduction u/s 57(iii) of the Act of Rs. 1,03,18,929/- against the income from 'other sources'. According to the Assessing Officer, as per the provisions of section 57(iii) of the Act, any other exp....
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.... the amounts received from Vikas Deep Sales were given to Shubham Vipra Associates and Shubham Housing Developers Pvt. Ltd. in earlier assessment year i.e. assessment year 2016-17. It was also submitted that in the earlier years such claim of interest payment was allowed u/s 57(iii) of the Act. 6. However, the Assessing Officer was not satisfied with the arguments of the assessee. Rejecting the various explanations given by the assessee and relying on various decisions, the Assessing Officer disallowed the payment of interest amounting to Rs. 1,03,18,929/- and made addition of the same to the total income of the assessee. 7. In appeal, the Ld. CIT(A) / NFAC upheld the action of the Assessing Officer on the ground that there is no corr....
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.... 6. The appellant prays leave to adduce such further evidence to substantiate her case as the Occasion may demand. 9. The Ld. Counsel for the assessee submitted that out of the amounts received from Vikas Deep Sales Pvt. Ltd. totaling Rs. 6,50,00,000/-, an amount of Rs. 6,00,00,000/- have been advanced to Shubham Vipra Associates and Shubham Housing Developers Pvt. Ltd. on various dates, the details of which are as under: Sr. No Receipt from Vikas Deep Sales Private Limited Application of Funds Balance as on 31st March 17 Date Amount Date Amount Name of the party 1 10-04-2015 3,00,00,000.00 10-04-2015 3,00,00,000.00 Shubham Vipra Associates 4,75,45,043.00 2 28-04-2015 3,00,00,000....
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....ing Officer and the Ld. CIT(A) / NFAC. 12. We have heard the rival arguments made by both the sides, perused the order of the Assessing Officer and Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the Assessing Officer in the instant case disallowed the claim of deduction u/s 57 of the Act on account of payment of interest out of interest income on the ground that the assessee could not justify that such expenditure was incurred wholly and exclusively for the purpose of earning such income from other sources. We find the Ld. CIT(A) / NFAC upheld the action of the Assessing Officer on the ground that there is no direct nexus between the interest ea....
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....1 dated 24.11.2020, the assessee was asked to furnish the details with respect to the large deduction claimed u/s. 57 in the ITR In response, the assessee furnished a reply letter dated 09.12.2020 along with Computation of Total Income, Copies of Form No. 16 (4 Nos.) and Copies of bank account statements. The assessee has not furnished any required details. Subsequently, vide Reminder letter dated 28.12 2020 and Notice u/s 142(1) of the IT Act, dated 03.02.2021, the assessee was asked to furnish the required details and also noticed that in the absence of required detail, why an amount of Rs. 97,27,186/- being claimed as Deduction u/s. 57 under the head Income from Other Sources should not be disallowed? In response, the assessee furnished ....
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.... In this connection, the assessee furnished the relevant ledger confirmation of the parties from whom the interest has been earned along with their ITR-V etc and verified. Further the assessee vide reply letter has substantiated that the interest expenses incurred by the assessee is being utilized for earning the interest income which is according to the principle laid down w/s. 57 which states that the expenditure must be laid out or expended wholly and exclusively and not necessarily for the purpose of making or earning the income irrespective of the fact that the assessee make the profit out of such expenses not. Further, that assessee stated that when the borrowed funds have been utilized for the purpose of making investment on whi....