|
The Tax Publishers2020 TaxPub(DT) 1789 (Del-Trib) INCOME TAX ACT, 1961
Section 57(iii)
Revenue authority did not doubt nexus between loan taken from NBFCs and further amount invested in FDR was not doubted by AO and thus a settled law deduction under section 57(iii) was allowable even if no income was earned by the assessee under section 56.
|
Income from other sources - Disallowance of expenditure claimed for the purpose of investments - Deduction under section 57(iii) whether allowable even when no income is earned by assessee under section 56 -
AO made disallowance under section 57 by holding that loss that the expenses incurred for the purpose of investment was not substantiated by placing any material on record except the FDR/Saving from which assessee earned interest income.Held: Revenue authority did not doubt nexus between loan taken from NBFCs and further amount invested in FDR was not doubted by AO. It is a settled law that the deduction under section 57(iii) will be allowable even if no income is earned by the assessee under section 56. The language of section 57(iii) does not anywhere specifies that any income should have been earned as a result of the expenditure incurred. It only specifies that purpose of expenditure should be that of earning income, it is mandatory that income should have been earned by the assessee. Addition in dispute was contrary to law and facts and therefore, the same was deleted.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
SUBSCRIBE FOR FULL CONTENT
|