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TMI Blog2023 (2) TMI 707X X X X Extracts X X X X X X X X Extracts X X X X ..... the claim for set off of interest paid to banks/financial institutions was allowed against interest earned by the assessee u/s 57 - Since the Revenue was accepted the principle consistency in earlier assessment years and also in subsequent assessment years there is no justification and deviating from the said principle only for the assessment year under consideration i.e. AY 2015-16. The Hon ble Delhi High Court in the case of Vodafone South Ltd. 2015 (10) TMI 22 - DELHI HIGH COURT] held that where assessee having availed of loan from HSBC advanced said amount to its holding company there was a direct nexus between earning of interest on loan advanced by assessee to its holding company and payment of interest to HSBC. The assessee s claim for netting off of interest in terms of Section 57(iii) of the Act was in order. Ratio of the decision applies to the facts of the case. We delete the disallowance made u/s 57 of the Act. Grounds raised by the assessee are allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... t of assessee's income for which no interest or expense was incurred by the assessee. On appeal the Ld. CIT(Appeals) sustained the order of the Assessing Officer observing that from the loan statements it is noted that the loans have been granted either for purchase of home or for development of the land. The Ld.CIT(A) observed that the purpose for which the loans are granted to Assessee are related to real estate and it is not as if the loans were taken from banks for the purpose of granting further loans to other parties and earning interest thereon. 3. Before us, the Ld. Counsel for the assessee submitted that Assessee is an individual earning income from House property and Income from other sources i.e., interest income from bank and also from various parties. Against this income assessee has claimed interest paid to various banks and financial agencies. From them loan was taken against property or otherwise. It is relevant to state that assessee has already claimed interest paid on the loans taken to purchase property. It would be noticed that during the year total rent received was Rs. 2,28,00,000/- against which Rs. 1,29,57,254/- was claimed and allowed by the AO (PB Pg 1-3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loan granted to M/s Shivangi Shelters was out of loan received from M/s Indiabull Housing on 08.12.2011 and income earned was declared and interest paid was claimed against such income. Copy of computation of income from AY 2011-12 to 2018-19 along with assessment order are enclosed for your kind perusal and it would be seen that interest paid to bank was claimed against interest earned from parties in AY 2011-12, PB 41-43, copy of assessment order at PB 44-47. In AY 2012-13 interest earned from the parties was declared and due tax thereon was paid PB 48 to 50, AO is placed at PB Pg 51 to 53. In AY 2013-14 interest paid to bank was claimed and duly been allowed by AO 54 to 59. Similar claim was made in AY 2014-15 PB 61 to 68. Even in the subsequent years i.e., in AY 2016-17, 2017-18 and 2018-19 claim was made and allowed PB 69 to 95. 4. It is further submitted that assessee is an income tax assessee and regularly filing income tax return and no addition on this issue of netting off of interest has ever been made in any of the previous or subsequent assessment years in the case of the assessee. Ld. Cousnel referred to PB Pg 41 to 95 pertaining to AYs 2011-12 to 2018-19 where this i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Delhi High Court in the case of Vodafone South Ltd. Vs. CIT [378 ITR 410] in respect of his above contentions. 6. The Ld. Counsel for the assessee further submits that rule of consistency is required to be followed as in the case of the assessee in none of the years either in the earlier assessment years or in the subsequent assessment years the claim of the assessee was denied except in the year under consideration i.e. AY 2015-16. Reliance was placed on the judgments of the Hon'ble Supreme Court in the case of CIT Vs. Excel Industries Ltd. [358 ITR 295], CIT Vs. J.K. Charitable Trust [308 ITR 161], Radha Soami Satsang Vs. CIT [193 ITR 321] (SC). 7. On the other hand, the Ld. DR strongly supported the orders of the authorities below. 8. Heard rival submissions, perused the orders of the authorities below and the material placed before us. The Assessing Officer while completing the assessment denied the claim for set off of interest paid by the assessee to banks/financial institutions against the income earned by the assessee from various companies on the ground that the assessee has not expanded the interest expenditure for earning interest income. The Ld. CIT(A) sustained th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2018-19 88,18,660/- (PB 86-88) 88,18,600/- (PB 89) 81,18,890/- (PB Pg 86) 51,46,303/- (PB Pg 86) Income returned accepted u/s 143(3) under National E- Assessment, PB 89-90 9.1 The Revenue year after year right from the AY 2011-12 has been examining the claim of the assessee in respect of the loans received by the assessee and the loans advanced by the assessee and the claim for set off of interest paid against interest earned by the assessee u/s 57 of the Act. In none of the assessment years there was any disallowance except in the year under consideration. 10. In the case of Bharat Sanchar Nigam Ltd. Vs. Union of India [282 ITR 273] the Hon'ble Apex Court referring to the decision in the case of Radha Soami Satsang (supra) held as under: "20. The decisions cited have uniformly held that res judicata does not apply in matters pertaining to tax for different assessment years because res judicata applies to debar courts from entertaining issues on the same cause of action whereas the cause of action for each assessment year is distinct. The courts will generally adopt an earlier pronouncement of the law or a conclusion of fact unless there is a new ground urged or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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