Case Law Details
ITO Vs Laxmipat Surana (ITAT Kolkata)
The revenue’s grievance is that the Ld. CIT(A) erred in deleting the disallowance made u/s. 43B of the Act for unpaid bank interest on secured loans of Rs. 3,55,54,116/-. We find that so far as amount of bank interest payable on the secured loans is concerned, there is no dispute. As far as invoking of provisions of section 43B is concerned, if an assessee claims certain deductions against revenue/income and, If such deductions include any bank interest payable to schedule bank on secured loan, the same is allowable only if it is actually paid. The assessee gets liberty if, in case, interest is not paid during the FY in which the assessee claims, but paid before the due date of filing of return u/s. 139(1) of the Act.
Before us, on the basis of submissions made by the Ld. Counsel for the assessee as well as the comments of the Ld.AO, forming part of statement of facts, we find that out of total alleged amount of Rs. 3,55,54,116/- the assessee has only claimed interest expenses of Rs. 54,07,493/- in its P & L account and remaining amount of Rs. 3,01,46,623/- has been shown as pre-operative expenses and assessee has not claimed this expenditure. We find that so far as interest of Rs.54,07,493/- is concerned undisputedly since the same has been claimed in the P & L account, but not paid by the assessee during the financial year 2013-14 and even not before the due date of filing of return u/s. 139(1) of the Act, the same deserves to be disallowed u/s. 43B of the Act and thus, the disallowance to this extent at Rs.54,07,413/- is confirmed. But, for the remaining amount since the assessee is not claiming deduction in the P & L account and showing it as pre-operative expenses, we confirm the finding of Ld. CIT(A) deleting the disallowance. However, we direct the revenue authorities to take note of this fact that in subsequent years if the assessee claims the Bank interest transferred to pre-operative expenses as an expenditure in the P & L account, the same can be allowed only if the assessee is able to prove with documentary evidences that the said bank interest on secured loans has actually been paid.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
This appeal of the revenue for the assessment year 2014-15 is directed against the order of ld. Commissioner of Income-tax (Appeals)-10, Kolkata dated 24-09-2017 and is arising out of the assessment order framed u/s. 147/143(3) of the Income Tax Act dated 25.3.2015 passed by Income Tax Officer (ITO), Ward-35(3), Kolkata.
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