Forum
Read and express views
× Latest Case Laws on Income Tax by various Income Tax Appellate Tribunals in India

These are the latest case laws decided by various Income Tax Appellate Tribunals (ITAT) of India on Income Tax which have been published recently. The case laws are open for discussion and we invite expert comments from our members on its applicability and effect on relevant issues.

10-01-2019, Prinku Landfin, Section 36(1)(iii), 68, Tribunal Delhi

  • amit
  • amit's Avatar Topic Author
  • Offline
  • Administrator
  • Administrator
More
1 week 1 day ago #8339 by amit
Section - 36(1)(iii), 68, 131, 13(6), 133(6)
Order Date - 10-01-2019
Favouring - Assessee allowed for the statistical purposes
Court - Tribunal Delhi
Appellant - Prinku Landfin P. Ltd.
Respondent - DCIT
Justice - PRASHANT MAHARISHI AM & K.NARASIMHA CHARY JM
Citation - 119Taxpundit135
Appeal No. - ITA No.1209/Del/2015
Asstt. Year - 2010-11

Order

PER : K. NARASIMHA CHARY

Challenging the order dated 05.01.2015 in Appeal No.1/13-14 for the Assessment Year 2010-11 by the learned Commissioner of Income-tax (Appeals)-7, Delhi, {hereinafter referred to as “the CIT(A)”}, assessee preferred this appeal.

2. Brief facts of the case are that the assessee is a company and for the Asstt.Year 2010-11, they have filed their income-tax return on 26.9.2010 declaring a total income of Rs.1,24,57,330/-. Assessment was completed by order dated 7.3.2013 u/s 143(3) of the Income-tax Act, 1961 (“the Act”) at an assessed income of Rs.1,82,49,644/- by making an addition of Rs.3,70,694/- by disallowing interest u/s 36(1)(iii), Rs.33,71,620/- by disallowing 95% of the expenses and Rs.20,53,000/- u/s 68 of the Act in respect of the share application money treating it as the unaccounted income of the assessee and by adding the commission at 2.5%.

3. When the assessee preferred appeal, learned CIT(A) by way of impugned order upheld the additions and dismissed the appeal. Hence, the assessee is in this appeal before us stating that the interest to the extent of Rs.3,70,694/- on account of car loan u/s 36(1)(iii) of the Act by recording incorrect facts. In respect of the disallowance of Rs.33,17,620/- towards 95% of the expenses of Rs.34,92,232/- under the head car running and maintenance, insurance and depreciation by recording wrong facts. So also ass ssee challenged the addition of Rs.20 lacs on account of share application money received from one M/s Pathik Merchandise Pvt. Ltd. and by making a further addition of Rs.50,000/- i.e. 25% of commission

4. Ground Nos. 4 to 6 are general in nature and do not require any specific adjudication.

5. Ground No.1 relates to the disallowance of the interest component on account of interest on car. According to the learned AO during the assessment proceedings, he found that the assesse company had rent out one Mercedez Benz at a monthly rent of Rs.28,500/-, car was purchased in February, 2008 by raising loan from ICICI bank with an EMI of Rs.1,27,072/- and the assessee company paid an interest of Rs.4,18,740/- attributable to the Benz car during the financial year 2009-10. Learned AO felt that it is beyond imagination of understanding and normal business practice as to how a prudent businessman could cause a loss for its own venture for providing some sort of advantage to others. On this premise, learned AO disallowed the difference between the interest paid
and the rent earned to the tune of Rs.76,740/- so also learned AO disallowed the interest on cars in the names of Prashant Bhalla stating that the payment of interest attributable to assets not put to use for the purpose of assessee’s business is not an eligible deduction u/s 36(1)(iii) and, therefore, the amount of Rs.3,70,694/- added holding that the assessee company has made an excessive claim of interest u/s 36(1)(iii) and failed to disclose true particulars. On this aspect, assessee’s case is that the Mercedez car which has been rented out for Rs.3,42,000/- was not the car on which the interest of Rs.4,18,740/- was paid but it was an old Mercedez car on which the interest was Rs.7860/-. However, learned AO made a mistake in this respect. Further all the vehicles except Toyota Land Cruzer are registered in the name of the assessee company and this fact is evident from the registration certificate submitted before the learned AO. It was also submitted before the learned AO that the vehicles were in the name of Prashant Bhalla on whose name the loan could be raised.

6. The learned DR placed reliance on the orders of the authorities below.

7. We have gone through the record. By way of letter dated 28.12.2012, which is at page 50 of the paper book, it was brought to the notice of the learned AO by the assessee that the Mercedez car , which was given on rent was only an old car in respect of which only Rs.7860/- was paid towards the interest and the amount of depreciation charged during the year was Rs.2,20,238/- which makes the total of Rs.2,28,098/- and as against this expenditure , the income from that car was Rs.3,42,000/-. However, the learned AO mistook this fact and instead of

Click to view and download Full Free Judgement of Prinku Landfin P. Ltd. vs. DCIT

Unable to display Google Map.




Time to create page: 0.243 seconds

If You Appreciate What We Do Here On TaxPundit, You Should Consider:

We are thankful for your never ending support.

Latest Analysis - High Courts

FIS GLOBAL BUSINESS SOLUTIONS INDIA PVT. LTD. vs. PCIT

FIS GLOBAL BUSINESS SOLUTIONS INDIA PVT. LTD. vs. PCIT

FIS GLOBAL BUSINESS SOLUTIONS INDIA PVT. LTD. vs. PCIT Read More
MATHUR MARKETING PVT. LTD. vs. CIT

MATHUR MARKETING PVT. LTD. vs. CIT

MATHUR MARKETING PVT. LTD. vs. CIT Read More
ITO  vs Union Bank Of India

ITO vs Union Bank Of India

ITO  vs Union Bank Of India Read More
PCIT vs RAJESH KUMAR

PCIT vs RAJESH KUMAR

PCIT vs RAJESH KUMAR Read More
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25

Forum Features

Latest Case Laws
Latest Case Laws are instantly updated in the Forum into their respective section
Latest from CBDT
Latest Circulars, Notifications, Orders etc. from CBDT is updated in the Forum
Ask Experts
You can ask questions to the community
Support
Support queries are either replied via mail or in the Forum so that others can be benefited
Press Releases
Latest Press Notes and Press Releases are updated in the Forum
Connect with Members
You can connect with our community members by replying to their queries

Recommended Articles

 

SITE INFORMATION

All content herein is the copyright of Taxpundit. No images, text, or any other content may be, reproduced or redistributed without the express written consent of Taxpundit.

All Rights Reserved. All Content Copyright.

Newsletter

Subscribe to our newsletter and stay updated on the latest developments and special offers!

Create your own website as per ICAI guidelines. Plan starts at Rs. 15000/- with Free Premium Membership. Read more
Toggle Bar