IN INCOME-TAX APPELLATE TRIBUNAL B BENCH, CHENNAI Before Shri A. Mohan Alankamony, Accountant Member & Shri Duvvuru RL Reddy, Judicial Member I T.A. No. 1201/Mds/2016 Assessment Year :2009-10 Shri K. Anand, Deputy Commissioner of No. 89, Santhapet, Vs. Income Tax, Gudiyattam, Vellore 632 602. Circle 1, Vellore. [PAN:AACPA3797N] ( Appellant) (Respondent) Appellant by : Shri B.R. Sudheendra, C.A Respondent by : Shri Supriyo Pal, JCIT Date of hearing : 12.07.2016 Date of Pronounce ment : 23.09.2016 O R D E R PER DUVVURU RL REDDY, JUDICIAL MEMBER: This appeal filed by assessee is directed against order of ld. Commissioner of Income Tax (Appeals) 13, Chennai, dated 07.01.2016 relevant to assessment year 2009-10. main issued raised in appeal of assessee is that ld. CIT(A) has erred in confirming disallowance made under section 14A r.w. Rule 8D. 2. Brief facts of case are that assessee is individual engaged in business of money lending and filed his return of income admitting 2 I.T.A. No.1201/M/16 total income at .21,20,109/-. return filed by assessee was processed under section 143(1) of Income Tax Act, 1961 [ Act in short]. Subsequently, case of assessee was selected for scrutiny and notice under section 143(2) of Act was issued on 23.08.2010. Further, notice under section 142(1) of Act was issued to assessee calling for books of account, supportive documents and evidences for expenses claimed. In response thereto, assessee produced all particulars and details as called for. After considering submissions of assessee and examining particulars furnished by assessee, Assessing Officer completed assessment under section 143(3) of Act by determining income of assessee at .24,71,920/- after making disallowance under section 14A r.w. Rule 8D. 3. assessee carried matter in appeal before ld. CIT(A). By ignoring case law of Hon ble Delhi High Court relied upon by AR of assessee in case of Cheminvest Ltd. in I.T.A. No. 749 of 2014 dated 02.09.2015, by relying on Circular No. 5/2014 dated 11.02.2014, ld. CIT(A) confirmed disallowance made by Assessing Officer. 4. On being aggrieved, assessee is in appeal before Tribunal. ld. Counsel for assessee has strongly relied on decision in case of Cheminvest Ltd. (supra) and pleaded that disallowance made by 3 I.T.A. No.1201/M/16 Assessing Officer be deleted. Per contra, ld. DR supported orders of authorities below. 5. We have heard both sides, perused materials on record and gone through orders of authorities below. In assessment order, Assessing Officer has noticed that assessee has taken loan from various persons including banks and has claimed expenses towards interest on such loans. In asset side of balance sheet, it was shown that non business assets not yielded any taxable income. Further, assessee has not earned any exempt income during previous year relevant to assessment year under consideration. 6. assessment order passed by Assessing Officer is very cryptic. In this case, assessee is engaged in business of money lending and earned interest income of .14,14,548/- and paid interest amount of .12,19,006/-. It may be fact that that assessee has taken loan from various persons including banks and also claimed expenses towards interest on such loans. Assessing Officer has not given any finding as to whether assessee has made investments out of borrowed funds or not. Before us, assessee has contended that assessee has not used any borrowed funds for making investments in earlier year. Before ld. CIT(A), assessee has admitted short term capital gain on sale of vacant land which existed as on 31.03.2008 for .20,37,000/- during this assessment 4 I.T.A. No.1201/M/16 year. amount of short term capital gain admitted by assessee was for .20,92,620/- and has also paid taxes on such short term capital gains. Further, assessee has submitted that items of Ranipet land for .25,971/-, plots for .5,34,000/- and Gold bullion for .5,95,000/- are assets which has yielded taxable income. Moreover, with regard to agricultural lands, assessee has submitted that assessee made total investments as on 31.03.2009 at .22,00,337/-, which is lower than capital of assessee. Without obtaining any remand report, ld. CIT(A) confirmed addition made by Assessing Officer. In view of above facts, we set aside order of ld. CIT(A) and remit matter back to Assessing Officer with direction to verify details as submitted by assessee before ld. CIT(A) and decide issue afresh in accordance with law by passing speaking order after allowing opportunity of hearing to assessee. 7. In result, appeal filed by assessee is allowed for statistical purposes. Order pronounced on 23rd September, 2016 at Chennai. Sd/- Sd/- (A. MOHAN ALANKAMONY) (DUVVURU RL REDDY) ACCOUNTANT MEMBER JUDICIAL MEMBER Chennai, Dated, 23.09.2016 Vm/- 5 I.T.A. No.1201/M/16 Copy to: 1. Appellant, 2. Respondent, 3. CIT(A), 4. CIT, 5. DR & 6. GF. K. Anand v. Deputy Commissioner of Income Tax, Circle 1, Vellore