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TMI Blog2024 (3) TMI 1067X X X X Extracts X X X X X X X X Extracts X X X X ..... the purpose of making an income. We observed that section 57(iii) is clear and has to be construed according to its natural meaning. It should not be given a narrowed meaning and the interpretation of section 57(iii) cannot be held to be conditional upon making or earning of the income. As relying on SRI SAYTASAI PROPERTIES INVESTMENT PVT. LTD. case [ 2014 (2) TMI 796 - CALCUTTA HIGH COURT] we are of the considered view that the assessee is eligible to claim deduction of interest expenditure incurred on borrowed funds utilized for making investment in shares of M/s. Dolphin Overseas Private Limited, Singapore as per the provisions of u/s. 57 of the Act. Appeal filed by the assessee is allowed.̴ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and also the books of account of etc., the Ld. AO observed that certain expenses viz., insurance, travelling, freight, sales commission, bad debts, miscellaneous expenses have increased abnormally compared to the Financial Year 2011- 12 and the Ld. AR of the assessee was asked to furnish the evidence of the expenses and also the confirmation letters from sundry creditors and their income tax returns. In response the Assessee s Representative submitted the information and after considering the submissions made by the Assessee s Representative, did not satisfy with the replies given and made certain additions ie., (i) disallowance of business courtesy expenses (20% of 2,45,770) Rs. 49,154/-; (ii) disallowance of claim of expenditure of load ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for deduction under the head income from other sources since the expenditure was laid out for the purpose of investment on which income would be generated in future. The Ld. AR also submitted that as per the provisions of section 57 of the Act, the interest expenditure was eligible for deduction even if no income was generated on investment in capital asset. On this issue, the Ld. AR heavily relied on the judgment of the Hon ble Calcutta High Court in the case of Sri Satyasai Properties And Investment P. Ltd vs. CIT reported in [2014] 361 ITR 0641 (Cal.). The Ld. AR therefore pleaded for deletion of the addition made by the Ld. AO and confirmed by the Ld. CIT(A)-NFAC. 4. On the other hand, Ld. Departmental Representative [DR] heavily relied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd. It could not be followed as to how can it be said that earning of dividend can be the sole motive or the sole source for the purpose of making income from other sources. What is an income from other sources has not been put into any straight jacket formula. Even the legislature has not attempted to define the words expressly. Income from other sources is a very wide term. The legislature has advisedly expressed without prejudice to the generality of the provision . Therefore, there was no reason why a proper expenditure should have been disallowed only because the investment was not made for the purpose of earning dividend. There is no finding that the investment was made otherwise than for the purpose of making an income. We are, as su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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