Case Law Details
HGP Community Pvt. Ltd Vs DCIT (ITAT Mumbai)
ITAT Mumbai held that interest on loan in respect of leased portion of the building is eligible for deduction u/s 24 of the Income Tax Act and accordingly cannot be allowed as work-in-progress.
Facts- In view of incriminating material belonging to the assessee seized and found at the premises of Hiranandani Group, after recording satisfaction under the provisions of the Act, a notice u/s. 153C of the Income-tax Act, 1961 was issued on 05/01/2015 for AY 2008 -09 to AY 2012 -13. Subsequently statutory notices under the Act were issued and assessment u/s. 153C read with section 143(3) of the Act were completed on 18/06/2015, wherein addition/ disallowance including disallowance for bogus purchases were made. CIT(A) adjudicated the appeals vide respective impugned orders. Aggrieved with the same, the assessee and Revenue are before the ITAT.
It is alleged by AO that amount of interest on loan pertains to the flats which are already constructed and leased out and therefore the same is to be reduced from the work-in-progress.
Further, AO also alleged that the amount of municipal taxes to leased part of the building is eligible for deduction u/s 24 of the Income Tax Act under head ‘Income from House Property’ and therefore cannot be allowed to be included in closing work-in-progress.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
