9911796707
TMI Blog2017 (8) TMI 1690X X X X Extracts X X X X X X X X Extracts X X X X ..... ds: i. The CIT(A) has erred in directing the AO to tax the whole interest income received by the appellant from Fixed Deposit of nationalized banks of Rs.19,54,732/- under the head income from other sources u/s.56 of the Income Tax Act, 1961 by not granting deduction u/s.80P of the Act. ii. Without prejudice to the above, it is submitted that even if such interest income of Rs.19,54,732/- is taxable u/s.56 of the Act, then expenditure incurred for earning such income must be allowed u/s. 57 of the Act and Pro-rata Interest income received from fixed deposit with nationalized banks only can be taxed. It is submitted that the same be allowed now. 2. The relevant facts as culled out from the materials on record are as under:- The assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see to allow proportionate expenses was not entertained by CIT(A) on similar issue in assessee's own case for A.Y. 2007-08. The AR of the assessee has been confronted on this issue but no written submission regarding objections was filed by the assessee. 2.4 Accordingly, addition of Rs.19,54,732/- was made. 3. Against the said order assessee preferred first statutory appeal before the learned CIT(A), who partly allowed the appeal of the assessee. 4. Now appellant's appeal is before us. 5. So far interest income received by the appellant from Fixed Deposit of nationalized banks of Rs.19,54,732/- under the head income from other sources u/s.56 of the Income Tax Act, 1961 is concerned. It is stated above that the assessee deposited the amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and other proportionate expenses to said income had to be brought to tax under section 56 - Held, yes and assessee's appeal was partly allowed by the Hon'ble High Court" 7. Respectfully, following the judgment of Hon'ble Karnataka High Court, the appellant is entitle for deduction of proportionate expenditure or actual expenditure which the appellant may have incurred in mobilizing the funds placed in deposit with the bank and the same needs to be calculated by the Assessing Authority. We remit this matter back to the file of the Assessing Officer who will examine the case of the assessee that how much expenditure he has incurred in mobilizing the funds and thereafter, Assessing Officer will pass an appropriate order. Therefore, we partl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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