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Issues involved: Appeal against order passed by CIT(A) for A.Y. 2004-05, disallowance of interest payable on loans borrowed from family brokerage firms for investment in shares and securities.
Summary: The appeal was filed by the assessee against the order passed by the CIT(A) for A.Y. 2004-05. The assessee had raised five grounds initially, but during the hearing, it was clarified that only ground No. 4 was pressed for consideration, while grounds No. 1, 2, 3, and 5 were not pressed. The main issue revolved around the disallowance of interest payable on loans borrowed from family brokerage firms for investment in shares and securities prior to 08.06.1992. The AO rejected the claim for interest deduction, which was upheld by the CIT(A) citing a similar decision in another case. The assessee, being aggrieved, appealed to the ITAT. During the hearing, the assessee's counsel presented orders from previous cases to demonstrate that similar issues had been set aside for fresh adjudication. The ITAT noted that the issue in question was identical to those in the previous orders and directed the CIT(A) to re-examine the matter in accordance with the law and the directions provided in the earlier orders. Additionally, the assessee had filed an additional ground contending that the income assessed by the AO should have been taxed in the hands of another individual, but this ground was later admitted to be without substance by the counsel. Consequently, the additional ground was rejected. Ultimately, the appeal filed by the assessee company was treated as partly allowed by the ITAT, with the order being pronounced in open court on 6th November 2013.
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