Income Tax Appellate Tribunal - Chennai
R.Santha, Chennai vs Assessee on 30 July, 2010
IN THE INCOME TAX APPELLATE TRIBUNAL
BENCH "B" CHENNAI
(Before Shri Abraham P. George, Accountant Member
and Shri George Mathan, Judicial Member)
......
M.A. No. 126/Mds/2010
(in I.T.A. No. 1499/Mds/2005)
Assessment Year : 2001-02
Smt. R. Santha,
29, Kannupillai Street, The Income Tax Officer,
New Washermenpet, v. Ward - VII(1),
Chennai - 600 081. Chennai - 600 034.
PAN : AANPS9380A
(Applicant) (Respondent)
Applicant by: Shri N. Devanathan
Respondent by: Shri B. Srinivas
O R D E R
PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER:
Grievance raised by the assessee in this Miscellaneous Application is that the Tribunal did not consider its grounds that interest free funds were utilized for giving the loans on which there were disallowance of interest for diversion of borrowed funds. Assessee also states that decision of Hon'ble jurisdictional High Court in the case of CIT v. S. Muthukarupan (2007) 290 ITR 154, though mentioned in support of her contentions, was not considered by this Tribunal.
2 M.A. No. 126/Mds/10
2. Short facts apropos are that assessee had advanced certain sum to her husband for which no interest was charged. Assessing Officer disallowed proportionate interest for the reason that interest bearing borrowed funds were utilized for this and also commercial expediency was not demonstrated. This was confirmed by the CIT(Appeals) in assessee's appeal and later by this Tribunal through the impugned order.
3. Now, regarding the first grievance of the assessee that interest free funds were utilized for giving the advances and this aspect was not considered, we find that the Tribunal has made specific mention thereof at page 4 of its order. The Tribunal has given a finding that the CIT(Appeals) had found that the advances to have been made out of borrowed funds. Vis-à-vis the second grievance regarding non- consideration of cited decision, we find that in para 8 of its order, the Tribunal had specifically considered the decision of Hon'ble Madras High Court in the case of CIT v. S. Muthukarupan (supra) and dealt with it in para 12 reproduced hereunder, which is self-explanatory:
"12. The argument of the assessee that her husband's properties have been hypothecated for availing credit facilities from bank is also not a valid ground to allow interest on funds not utilized by the assessee for her business purpose. The decision of the Madras High Court relied on by the ld. counsel is concerned, we do not understand how it is relevant to the present case. The 3 M.A. No. 126/Mds/10 ld. counsel has not even attempted to explain how the judgement of the Madras High Court would be applicable to the assessee's case."
4. Thus, we find that it was only after considering all the facts and circumstances of the case, the Tribunal held the Assessing Officer to have been justified in disallowing a portion of interest pertaining to the interest free advances given by the assessee to her husband.
5. Thus, in the guise of Miscellaneous Application the assessee is only seeking a review for which this Tribunal is not having any power. All the grievances mentioned by the assessee have found the reference in the Tribunal order and we cannot find any mistake apparent on the record.
6. In the result, the Miscellaneous Application filed by the assessee stands dismissed.
The order was pronounced in the open court on 30th July, 2010.
sd/- sd/-
(George Mathan) (Abraham P. George)
Judicial Member Accountant Member
Chennai.
Dated the 30th July, 2010.
Kri.
Copy to: Applicant/Respondent/CIT(A)/CIT/D.R./Guard file