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TMI Blog2021 (9) TMI 1253X X X X Extracts X X X X X X X X Extracts X X X X ..... 2020 for the Assessment Year (A.Y.) 2017-18 and cross objections are filed by the assessee . 2. Ground No.1, 6 and 7 are general in nature which does not require specific adjudication. 3. Ground No.2 is related to the disallowance of amount of Rs. 5,74,016/- and Rs. 77,000/- as not related to business expenditure. During the assessment proceedings, the AO found that the assessee had claimed the interest expenditure of Rs. 5,74,016/- related to the amounts advanced to VVCIPL under the head 'business income'. Therefore, the AO called for the explanation of the assessee as to why the said expenditure should not be disallowed and brought to tax. In response, the assessee stated that the expenditure of interest was claimed under 'business inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refully considered the issue and the facts. There is no dispute that the appellant had earned interest income of Rs. 10,03,668/-. There is also no dispute that the appellant had borrowed funds and paying interest. It is also not in dispute that the borrowed funds are invested in sister concern and earned interest income. In this factual matrix, the appellant's claim of interest debiting P&L account to the extent of Rs. 5,74,016/- is an allowable expenditure and the interest income is treated as income from other sources as it is not related to his business. Accordingly, the Assessing Officer is directed to delete the addition of Rs. 5,74,016/-". The department has not disputed the fact that the assessee has received income of Rs. 5,74,016/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supposed to furnish the details with regard to flat No., identify the buyer etc. to claim the expenditure. Without having furnished the above details, the AO cannot verify the genuineness of the expenditure. It also appears that the AO did not make any effort to collect the details. Therefore, we remit the matter back to the file of the AO with a direction to reexamine the issue in detail and decide the issue afresh on merits. Appeal of the revenue on this ground is allowed for statistical purpose. 11. Ground No.4 is related to the disallowance of expenditure u/s 40(a)(ia) of the Act, amounting to Rs. 39,46,426/- for non deduction of tax at source. During the assessment proceedings, the AO found that the assessee has debited the expenditur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ducted the TDS. The remaining payments were outside the purview of TDS since each payment was less than the threshold limit for deduction of TDS. The AO did not identify each payment and the quantum of TDS that is required to be made. It is the obligation of the AO to ascertain the details of payments made to each person from the books of accounts and determine the TDS liability to make the addition. During the appeal hearing, the Ld.DR did not place any material to controvert the finding given by Ld.CIT(A). Therefore, we do not find any reason to interfere with the order of the Ld.CIT(A) and the same is upheld. Appeal of the revenue on this ground is dismissed. 15. The next ground is cash deposits made in the bank account during demonetiz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal of the revenue. 19. The next issue in this appeal in ground No.5 is the addition of Rs. 2,10,61,012/- made u/s 68 which was deleted by the Ld.CIT(A). The AO found that there was an increase in capital account of the assessee to the extent of Rs. 2,10,61,012/- which was explained to be the amount given by Mr.Jaya Prakash Babu and submitted the ledger account . Since the assessee did not prove the increase in capital with the substantial evidence the AO treated the same as unexplained cash credit and made the addition u/s 68 of the Act. 20. Against the order of the AO the assessee went on appeal before the Ld.CIT(A) and the Ld.CIT(A) deleted the addition observing that the amount was transferred from the account of Mr.Jaya Prakash Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X
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