9911796707
TMI Blog2021 (9) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... stments - interest income from loan and investment was reflected in the Profit and Loss Account and Income Tax Return was filed as per profit shown in the Profit and Loss Account. - In the decision of the Coordinate Bench of the ITAT in the case of Co-op. Bank of Mehsana Ltd. [ 2019 (1) TMI 1917 - ITAT AHMEDABAD] wherein the similar issue on identical facts has been adjudicated in favour of the assessee - We find merit in the submission of the assessee and allow the appeal of the assessee as charging of notional interest is not justified. - Decided against revenue. - I.T.A. No. 297/Ahd/2019 - - - Dated:- 25-8-2021 - Mahavir Prasad, Member (J) And Amarjit Singh, Member (A) For the Appellant : H.V. Doshi, AR For the Respondents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee reiterating the fact stated by the Ld. AO. 5. We have heard both the side and perused the material on record. During the course of assessment the AO noticed that assessee has not collected any rent towards safe deposit vaults allotted to its customer and deposits of ₹ 4,23,65,500/- was collected from customers against allotment of safe deposit vaults. The assessee explained that these interest free deposits received from safe deposit vaults(s) customers was used in the business of banking. The AO has not agreed with the submission of the assessee, therefore, the AO has computed notional interest on such deposits @ 8.25% and made addition of ₹ 34,95,154/- to the total income of assessee. During the course of appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee had provided lockers to the customers and collected security deposits against the safe deposit vaults to the amount of ₹ 55,88,500/-. The assessee had not charged any rent for the lockers from the customers. However the assessing officer has charged notional interest @ 8.25% on the aforesaid lockers deposit amount and made addition of ₹ 4,61,051/- as locker rent as income from other sources u/s. 56 of the I.T. Act. The ld. CIT(A) has restricted the impugned addition to the amount of ₹ 1,31,150/- holding that interest to be charged on day to day balance as against the total outstanding deposit. We are of the opinion that there is no basis of charging interest on the security deposit taken for providing lockers by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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