2025 (12) TMI 1226

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....terest expenses of Rs. 6,71,628/- (out of total interest expenses claimed of Rs. 11,82,661) considering not for business purposes. 2. The ld. CIT(A) even the cash credit interest paid on business stock hypothecation bank loan has been disallowed. 3. Any other matter with prior permission of the chair. 3. At the outset itself, it was pointed out that there was a solitary issue involved in the present appeal pertaining to disallowance of interest claimed by the assessee as business expenditure under Section 36(1)(iii) of the Act. The quantum of disallowance of interest amounts to Rs. 6,71,628/- and the disallowance was made finding the said expenditure to have not been established by the assessee, to have been incurred wh....

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....d. CIT(A) to the effect, that the assessee had not earned any income from the said property, nor, had demonstrated the property to be let out and, therefore, the assessee's claim of deduction of interest under Section 24(b) of the Act was not tenable. 6. We have heard the rival contentions. The issue for our consideration is the allowance of claim of interest expenses amounting to Rs. 6,71,628/-, which the assessee had claimed as business expenses and alternatively, as expenses allowable under the head "Income from House Property", under Section 24(b) of the Act. 7. The facts relating to the issue which are not in dispute, and which emanate from the orders of the authorities below, are that the assessee is an individual and is carryin....

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.... impugned asset for business purposes, during the impugned year. He was unable to demonstrate the establishment of the fact of user of the asset for business purposes before the lower authorities and was unable to do so before us also. During the course of hearing, he referred to an UDYAM Registration Certificate issued by the Government of India, Ministry of Micro, Small and Medium Enterprises, to the assessee pointing out that as per the said Certificate the impugned property was put to use in the business of the assessee. The said document was placed in paper book at page No.1 to 4A. However, it was pointed out at Bar to the learned counsel for the assessee that the impugned Certificate reflected the date of UDYAM Registration as 27.04.2....

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.... making the following deductions namely: (a)............................................. (b)where the property has been acquired, constructed, repaired, renewed or reconstructed with borrowed capital, the amount of any interest payable on such capital: Provided that in respect of property referred to in sub-section (2) of Section 23, the amount of deduction (or, as the case may be, the aggregate of the amount of deduction) shall not exceed thirty thousand rupees: Provided further that where the property referred to in the first proviso is acquired or constructed with capital borrowed on or after the 1st day of April, 1999 and such acquisition or construction is completed (within (five) years from the end....