ITAT reversed CIT(A)'s addition under s.69 regarding unexplained ...

Tax Tribunal Allows Mother's Loan as Valid Source for Property Investment, Directs Verification of Interest Claims u/s 24.

January 27, 2025

Case Laws Income Tax AT

ITAT reversed CIT(A)'s addition under s.69 regarding unexplained property investment, accepting loan from assessee's mother as legitimate source after verification of her creditworthiness in reopened assessment. On interest disallowance under s.24, ITAT directed AO to verify if assessee's investment from borrowed funds was limited to their ownership share. Interest deduction permitted only on borrowed funds used for initial property investment up to assessee's share portion, following prudent investment principle. Subsequent investments, even if from borrowed funds, deemed ineligible for s.24 interest deduction. Matter remanded to AO for verification of fund utilization patterns in bank accounts and determination of allowable interest based on initial investment share.

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ITAT reversed CIT(A)'s addition under s.69 regarding unexplained ...

Tax Tribunal Allows Mother's Loan as Valid Source for Property Investment, Directs Verification of Interest Claims u/s 24.

January 27, 2025

Case Laws Income Tax AT

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