TaxTMI 
TaxTMI 
2026 (5) TMI 1419
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....s. 2. On the facts and circumstances of the case, the Learned CIT(A)has erred in upholding the order passed by the Ld. Assessing officer ('A.O'), wherein the Ld.A.O has erred in making disallowance on account of Interest expense claimed under section 57 of the Income-tax Act, 1961 amounting to Rs. 27,01,241. The disallowance is unjustified, unwarranted and uncalled for 3. On the facts and circumstances of the case, the Learned CIT(A) has erred in upholding the order passed by the Ld. AO, wherein the Ld. A.O has erred in not considering the current year loss of Rs. 5,18,307(Rs.1090000-Rs.1608307) while calculating total assessed income. 4. The Appellant reserves the right to add, amend or alter any grounds ....
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....rest income and partly for the purchase of a residential property. The A.O did not find favour with the submissions of the assessee and disallowed interest expenditure of Rs. 27,01,241/- claimed by the assessee against interest income. 5. That being aggrieved by the addition made by the A.O, the assessee preferred an appeal before the Ld. CIT(Appeals)/NFAC. It was observed by the first appellate authority that the assessee is not only earning interest income but earning salary income from GDR Rungta College of Engineering and Technology and Rungta College of Dental Science and Research. In the return filed, the assessee had declared total income at Rs. Nil after declaring interest income of Rs. 10,92,934/- and claimed deduction of intere....
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....purchasing of residential plot of land therefore which are personal expenditures and the ingredients to Section 57 of the Act regarding the direct nexus of borrowing funds and earning interest income is not established in the case of the assessee. 8. The Ld. Counsel for the assessee failed to demonstrate any reasons why the findings of the Ld. CIT(Appeals)/NFAC should not be upheld. The Ld. Counsel failed to answer that when the borrowed funds have been utilized for purchasing of shares and investment in plot of land then where is the nexus regarding borrowed funds and the interest income earned. He had relied on the fund flow statement which was already rejected by the sub-ordinate authorities. This is a case of mere assertions of inten....
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....ntion of such spending shall have to be only for earning the interest income. That further, deduction u/s. 57 of the Act cannot be allowed if following conditions are not fulfilled by the assessee: a. Expenditure should be incurred wholly and exclusively for the purpose of earning income; b. It should not be in the nature of capital expenditure; c. It should not be in the nature of personal expenditure of the assessee; d. It should be incurred in the accounting year and not prior or subsequent year. 11. Reverting to the facts of the present case, when the assessee had invested in purchasing of shares, plots of land, it is clear that money was borrowed only for the purpose of business and personal expen....