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2021 (1) TMI 534 - AT - Income TaxDisallowance of statutory expenses claimed - HELD THAT - Such expenditure has to be allowed as deduction. The finding of the AO that this expenditure is levied on house property income is factually incorrect. Thus we allow this ground of the assessee and direct the AO to allow this deduction. Interest paid on income tax refund - assessee submits that he had not received any such interest and in support produced Form-26AS - Revenue submits that as per its record, interest has been paid by the Department to the assessee on the amount of income tax refund - HELD THAT - As agreed to by both the parties, this issue is remanded back to the file of the AO for fresh adjudication in accordance with law. We direct the AO to serve on the assessee the document based on which, he comes to a conclusion that interest has been paid to the assessee on income tax refund. If such evidence is not handed over to the assessee, no addition can be made.
Issues:
1. Disallowance of undisclosed rent receipt 2. Disallowance under section 24(b) 3. Disallowance of establishment expenses 4. Addition of alleged undisclosed interest income 5. Addition in the computation of book profit under section 115JB 6. Disallowance of repair and maintenance expenses 7. Disallowance of statutory expenses Issue 1 - Disallowance of Undisclosed Rent Receipt: The appeal contested the addition of undisclosed rent receipt. The Commissioner of Income Tax (Appeals) did not delete the addition, which the appellant argued was unjustified. The matter was set aside by the CIT(A). The Tribunal dismissed ground no. 1 as not pressed. Issue 2 - Disallowance under Section 24(b): The appeal challenged the addition disallowed by the Assessing Officer under section 24(b). The CIT(A) confirmed this addition, which the appellant contested. The Tribunal dismissed ground no. 2 as not pressed. Issue 3 - Disallowance of Establishment Expenses: The appeal contested the disallowance of statutory expenses claimed by the assessee. The expenses were detailed, and the Tribunal found that such expenditure must be allowed as a deduction. The AO's finding that this expenditure is levied on house property income was deemed factually incorrect. The Tribunal allowed this ground of the assessee and directed the AO to allow the deduction. Issue 4 - Addition of Undisclosed Interest Income: The appeal contested the addition of alleged undisclosed interest income. The Tribunal directed the AO to serve the document based on which the conclusion was drawn that interest had been paid to the assessee on income tax refund. The issue was remanded back to the AO for fresh adjudication in accordance with the law. Issue 5 - Addition in the Computation of Book Profit: The appeal contested the addition in the computation of book profit under section 115JB. The Tribunal allowed ground no. 5 for statistical purposes. Issue 6 - Disallowance of Repair and Maintenance Expenses: The appeal contested the action of the CIT(A) in allowing part relief in respect of repair and maintenance expenses. The Tribunal dismissed ground no. 6 as not pressed. Issue 7 - Disallowance of Statutory Expenses: The appeal challenged the disallowance of statutory expenses claimed by the assessee. The Tribunal found that the expenses should be allowed as a deduction and directed the AO to allow the deduction. In conclusion, the appeal was allowed in part, with various grounds dismissed as not pressed or allowed for statistical purposes. The Tribunal directed the AO to reexamine certain issues in accordance with the law.
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