9911796707
TMI Blog2012 (12) TMI 449X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (a) correctness of the Tribunal's order quashing reassessment proceedings for the assessment years 2004-05 and 2005-06; (b) correctness of the opinion of the Tribunal in regard to the taxability of the amounts claimed by the assessee as payments made towards interest on borrowed capital for construction of the property in computing the property income; (c) the legality of the Tribunal's view in respect of the inapplicability of Section 45(4) for assessment year 2004-05. 2. The facts of the case briefly are that the assessee is a firm comprised of two partners which was allotted an industrial plot in Mohan Cooperative Industrial Estate (MCIE), Mathura Road, New Delhi and had constructed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its of the assessee's claim for deduction under Section 24(6) of the Income Tax Act and in paras 22-24 of its impugned order, allowed the same. The reasoning of the Tribunal in that regard is as follows: "23. We have duly considered the rival contentions and gone through the record carefully. The assessee has submitted a statement exhibiting the utilization of current loan taken from Vysya Bank which has been noticed by the Learned CIT(Appeals) and extracted by us in the foregoing paragraphs. The stand of the assessee is that if the balance sheet of the partners and of the assessee are read together then it would reveal that the assessee is not having any other fixed assets on the assets side except t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her the partners as well as the assessee must have used this amount for some other activities. The revenue is unable to collect any evidence demonstrating the other activities. As far as other aspects are concerned, there is no dispute between the department and the assessee. The interest expenses incurred by the assessee on the borrowed funds if sued for the purpose of construction then deduction of such expenses will be admissible to the assessee under Section 24(b) of the Income Tax Act, 1961. The only dispute between the parties relates to the quantification of amounts used for the purpose of construction. On an analysis of the balance sheet, we are of the view that the assessee is able to demonstrate, utilization of funds for the purpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of the interest claimed for deduction under the head of "interest" is to be found in paras 23 onwards. Earlier para 23 has been extracted. The matter is entirely factual. Since the Tribunal constitutes the final court of fact, nothing new has been brought to the notice of this Court to warrant the conclusion that the inference drawn by the Tribunal on the materials available were unreasonable or perverse. Consequently, question no.2 is answered in favor of the assessee and against the revenue. 6. As regards the correctness of the Tribunal's findings on the reassessment proceedings, there are two Full Bench decisions of this Court (refer CIT v. Kelvinator of India Ltd. 2002 (256) ITR 1 (Del) [FB]) and CIT v. Usha International Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officer and answers given by the assessee but in other cases, a deeper scrutiny or examination may be necessary. The stand of the Revenue and the assessee would be relevant. Several aspects including papers filed and submitted with the return and during the original proceedings are relevant and material. Sometimes application of mind and formation of opinion can be ascertained and gathered even when no specific question or query in writing had been raised by the Assessing Officer. The aspects and questions examined during the course of assessment proceedings itself may indicate that the Assessing Officer must have applied his mind on the entry, claim or deduction, etc. It may be apparent and obvious to hold that the Assessing Officer would ..... X X X X Extracts X X X X X X X X Extracts X X X X
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