9911796707
TMI Blog2021 (2) TMI 342X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The facts of the case are that the assessee is a Doctor by profession in Bangalore. He has availed housing loan from Syndicate Bank in the year 2005-06 for construction of residence at Bangalore. The said loan was taken over by Standard Chartered Bank vide Agreement dt.20.06.2011. The assessee has also availed another loan bearing No.45605115894 of Rs. 3.33 Crores vide Agreement Dt.20.06.2011. The interest on first housing loan was Rs. 4,68,940. The interest on another loan of Rs. 3.33 Crores was at Rs. 35,72,717. The assessee claimed interest on loan of Rs. 1,50,000 under Section 24 of the Act. The assessee has claimed Rs. 35,72,717 interest as a deduction from business income. The Assessing Officer observed that the second loan of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chartered Bank. In the assessment year under consideration, the assessee incurred interest expenditure on this loan at Rs. 4,68,940 and out of this, the assessee claimed Rs. 1.5 lakhs as deduction Under Section 24 under the head 'House Property'. The second loan was availed by the assessee at Rs. 3.33 Crores in the year vide Agreement dt.20.06.2011. It is a Topup loan by mortgaging of residential house at Rs. 3.33 Crores and this is a business loan and on which the assessee incurred an expenditure of Rs. 35,72,717 towards interest and this was claimed as business expenditure Under Section 36(1)(iii) of the Act. This loan has no connection with the construction of the building and it is not a home loan though the name has been given as hom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,72,717. The assessee claimed this as an expenditure Under Section 36(1)(iii) of the Act. The Assessing Officer allowed 50% of the expenditure and balance amount disallowed to the extent of Rs. 17,86,360. Now the contention of the ld. DR is that the assessee has not commenced the business and this amount has been utilized for construction of building and purchase of equipment which was not put to use so as to claim the deduction Under Section 36(1)(iii) of the Act. The interest was not allowed under Section 36(1)(iii) of the Act by the lower authorities. In our opinion, the usage of loan fund to be examined by the Assessing Officer by verifying the amount released by the Standard Chartered Bank. The Assessing Officer has to examine how the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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