Case Law Details
Amit Dhirajlal Doshi Vs DCIT (ITAT Ahmedabad)
Explore the ITAT Ahmedabad ruling in Amit Dhirajlal Doshi vs. DCIT regarding interest expenditure deduction under Section 57 of Income Tax Act.
Introduction: In the case of Amit Dhirajlal Doshi vs. DCIT (ITAT Ahmedabad), the Income Tax Appellate Tribunal (ITAT) has addressed a significant matter concerning the deduction of interest expenditure under Section 57 of the Income Tax Act. The ITAT ruled in favor of the assessee, asserting the lawfulness of the deduction based on the utilization of borrowed funds for interest-bearing advances.
Background: Amit Dhirajlal Doshi, the assessee, filed an appeal against the order dated 18.05.2018 issued by the CIT(A)-1, Ahmedabad for the Assessment Year 2013-14. The appeal focused on two key issues: the addition of Rs. 6,11,400 under the “salaries” category and the addition of Rs. 31,47,497 under Section 57.
Salary Income Discrepancy: During the assessment, it was observed that the assessee credited an amount of Rs. 58,63,992 as salary income, which included various components like car reimbursement, children education, driver salary reimbursement, helper, telephone reimbursement, and uniform attire reimbursement. However, in the income statement, the assessee had declared a salary income of only Rs. 52,52,592. As a result, the Assessing Officer added Rs. 6,11,400 as the difference in the declared salary income.
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