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TMI Blog2023 (7) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... ocess he has himself verified the fulfilment of condition directed by the ITAT. We see no infirmity in the same. Ultimately what the ld.CIT(A) has done is undisputedly in the light and in accordance with the direction of the ITAT in Asst.Year 2008- 09. Therefore, we do not find any merit in the grounds raised by the Revenue vi-a-vis restriction of addition made by the ld.CIT(A) under section 68 of the Act. Disallowance of interest expenses u/s 36(1)(iii) - CIT-A deleted addition - HELD THAT:- No reason to interfere in the order of the ld.CIT(A) who has deleted the disallowance of interest u/s 36(1)(iii) of the Act giving factual finding, which have remained uncontroverted by the Revenue before us as under Interest bearing funds were not found by the AO to be utilized for non-business purpose and Interest free advances given by the assessee were made in the course of business of the assessee. In view of the above, order of the ld.CIT(A) deleting the addition of interest under section 36(1)(iii) of the Act is upheld. - ITA No.1548/Ahd/2019 And ITA No. 1571/Ahd/2019 WITH CO No.23/Ahd/2022 AND ITA No.1565 & 1566/Ahd/2019 WITH CO NO.21 and 22/Ahd/2022 - - - Dated:- 21-7-2023 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive buyers of plots in both these projects of the assessee, which were treated by the Assessing Officer (AO) as unexplained and added to the income of the assessee under section 68 of the Act. 5. The facts leading to the addition being that on being asked to prove genuineness of all the advances received by the assessee during various years impugned before us, the assessee had explained that these advances had been received from prospective allottees of land which were being developed by the assessee in two schemes as mentioned above i.e. NSC and AFC. The assessee had explained that the schemes were spread over five to six years and the prospective allottees were paying instalments monthly as per the scheme of payment opted by them. These amounts were, therefore, shown as instalments given by the assessee and were transferred to income account as and when entire amount of sale consideration was received and sale deed was made along with handing over of the possession of the booked plots to the prospective buyers. In all the years involved, the AO asked the assessee to file details of all advances received. With respect to advances where no PAN details of the investor was provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts quantified by the AO as sustainable in view of the order of the ITAT in Asst.Year 2008-09 to ultimately the amount confirmed by the ld.CIT(A) taking note of the submissions of the assessee and following which order additions were deleted in subsequent years is tabulated as under: Asst. Year Amount added under section 68 by the AO with respect to advances where PAN not furnished Amount of addition determined by the AO as sustainable in terms of order of the ITAT in Asst.Year 2008-09 Amount ultimately sustained by the ld.CIT(A) taking note of the submission of the assessee before him. 2010-11 Rs. 13,63,63,266/- 2,01,84,585/- Rs. 55,44,747/- 2011-12 Rs. 4,80,32,902 - Rs. 39,16,358/- 2012-13 Rs. 8,69,30,701/- - Rs. 20,52,792/- 2013-14 Rs. 5,79,95,555/- - Rs. 53,64,593/- 7. Aggriev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to be sustained with respect to those advances where PAN details were not available. The AO accordingly had himself recomputed the quantum of addition to be sustained in A.Y 2010-11. Therefore, with respect to the restriction of addition under section 68 as admitted by the AO himself in his remand report and as tabulated above by us, for A.Y 2010-11, we hold that there could be no grievance of the Revenue, since AO himself had accepted the same to be the addition sustainable in view of the directions of the ITAT in the case of the assessee for Asst.Year 2008-09. 12. With respect to further reduction in the quantum of addition by the ld.CIT(A) as tabulated by us above in A.Y 2010-11 , we have noted from the orders authorities below that the assessee had furnished PAN details in a few more cases of advances received, to the ld.CIT(A) and taking note of the same, he had deleted the addition made with respect to these advances following the directions of the ITAT. This method was followed by the Ld.CIT(A) in subsequent years also ,wherein following the direction of the ITAT in A.Y 2008-09 and based on details furnished by the assessee of available PAN numbers of advances, he de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest expenses also on loans taken. Accordingly, he disallowed interest paid by the assessee. The ld.CIT(A) deleted the same noting that the AO has not appreciated the contention of the assessee that all the advances were made for business purpose for purchase of land in the business of land development carried out bythe assessee, and further that, there was no finding by the AO that loans on which interests were paid were not utilized for the business purpose of the assessee. The finding inthis regard at para 9.3 of his order are as under: 9.3 I have carefully considered the facts of the case, observation of the A.O as well as the submission filed by the appellant. The A.O. has observed that the appellant had claimed interest of Rs. 19,56,504/- in the Profit Loss account. It had also been observed by him that the appellant had made advances of Rs. 3,57,23,097/- on which no interest had been charged except for the advance given to M/s Roopa Associates and M/s Shivam Enterprises to whom the loans of Rs. 50.00 lakhs and Rs. 10.00 lakhs respectively were given. The explanation for the same is that the loans were provided out of the advances received from the prospective buyers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he submissions made by the assessee before the ld.CIT(A) that all the advances were given for purchase of land for the said business of the assessee, and therefore also there was no occasion to make any addition of interest expenditure on making such interest free advances. The contention of the assessee as above before the ld.CIT(A) has been reproduced at page no.56 of the order and was pointed to us during the course of hearing. The ld.DR was unable to controvert the contentions of the assessee on the above finding of the ld.CIT(A) as noted above by us. He merely relied on the order of the AO. 19. Having heard both the parties, we see no reason to interfere in the order of the ld.CIT(A) who has deleted the disallowance of interest under section 36(1)(iii) of the Act giving factual finding, which have remained uncontroverted by the Revenue before us as under: i) Interest bearing funds were not found by the AO to be utilized for non-business purpose; ii) Interest free advances given by the assessee were made in the course of business of the assessee. In view of the above, order of the ld.CIT(A) deleting the addition of interest under section 36(1)(iii) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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