Hemant Dhawan Vs ITO (ITAT Delhi)
Delhi Tribunal decided whether notional interest income could be taxed where assessee never actually received the money.
Assessee had booked units in a project “Oh My God” developed by M/s Alisa Infratech Pvt. Ltd. & paid ₹5 crores between FY 2013-14 & 2014-15. When developer defaulted, disputes arose & an MoU was signed on 04.04.2016 for repayment of ₹6.50 crores (₹5 crores booking refund + ₹1.50 crores compensation). Out of this, only ₹1.50 crores cheque cleared. The remaining ₹5 crores cheques bounced. Later, on 22.01.2018, developer gave a DD of ₹2 crores.
The developer, however, filed TDS return showing ₹3.60 crores as “interest” & deducted ₹36 lakhs TDS. On this basis, Assessee mistakenly offered ₹3.60 crores as income in ITR for A.Y. 2018-19 & claimed TDS credit. During assessment, Assessee filed revised computation excluding ₹3.60 crores as unreal income, but AO refused citing Goetze (India) ruling. AO assessed total income at ₹3.58 crores including the said figure. CIT(A) confirmed addition.
Before Tribunal, Assessee argued that appellate authorities are not barred from entertaining fresh claims (relying on Jai Parabolic Springs Ltd., Pruthvi Brokers & Shareholders). He submitted that receipts of ₹3.50 crores (₹1.50 + ₹2 crores) plus TDS of ₹36 lakhs only represent partial refund of booking advance & not taxable income, since they were less than principal of ₹5 crores advanced.
