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TMI Blog2021 (11) TMI 313X X X X Extracts X X X X X X X X Extracts X X X X ..... unil Kumar Sharma [ 2002 (2) TMI 91 - PUNJAB AND HARYANA HIGH COURT] wherein it was held that unpaid price is to be treated as borrowed capital within the meaning of Section 24(b). Hence, on independent examination of the facts and the provisions of law, we hold that the interest paid by the assessee to BIL is an allowable deduction as it amounts to interest on the capital borrowed. Disallowance u/s. 14A - AR argued that the disallowance cannot be more than the exempt income earned - HELD THAT:- Since, the proposition of law is clear by now that the disallowance cannot exceed the exempt income, the contention of the ld. AR is allowed. Disallowance of expenses u/s.14A for computing the book profit u/s. 115JB - In accordance with the clause ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uire or construct the impugned properties, so interest incurred on outstanding purchase consideration is not eligible for deduction u/s. 24(b) of the Income Tax Act, 1961. 3. The Ld. CIT(A) has erred in law and on facts in restricting the addition to ₹ 6,72,266/- as against ₹ 3,59,40,416/- made by the AO on account of disallowance u/s. 14A r.w.r 8D of Income Tax Rules. 4. The Ld. CIT(A) has erred in law in holding that since the assessee has suo-motto disallowed expenditure to the extent of ₹ 3,64,58,112/- relating to earning of exempt income, further disallowance of expenses u/s. 14A cannot be imported into while computing the book profit u/s. 115JB of the Income Tax Act, 1961 ignoring the provisions contained in Expl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l, the assessee is eligible for deduction u/s. 24(b) of the Act. The ld. CIT(A) also held that the deduction was allowed by the Revenue in the earlier years. 6. Before us, the ld. DR argued that the principle of res judicata is not applicable to the decision of Income Tax Authorities and relied upon the judgments of Hon'ble Madhya Pradesh High Court in the case of Lachhiram Puranmal Vs. CIT (119 taxmman), judgment of Hon'ble Bombay High Court in the case of Baijnath Brijmohan & Sons (P.) Ltd. Vs. CIT ( 161 ITR 234), judgment of Hon'ble Delhi High Court in the case of Prominent Motors (India) Vs. CIT (8 taxmann 181), judgment of Hon'ble Calcutta High Court in the Smt. Kamala Devi Jhawar Vs. CIT (115 ITR 401) and the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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