S. 48 : Capital gains-Cost of improvements-Amount spent on property habitable allowable as deduction-Amount spent on refrigerator, air conditioner LED, TVS furniture, dining table etc. are personal effects-Not eligible for deduction-Interest on housing loan-Matter remanded to the Assessing Officer. [S. 24, 45, 133(6)]
The assessee sold the flat and offered the capital gains but also claimed certain expenditure and interest paid on housing loan adding to cost of acquisition and cost of improvement of property and indexation on said amount. The Assessing Officer issued notice u/s. 133(6)) of the Act to the suppliers of materials and no reply was received. The Assessing Officer denied the deduction. On appeal the CIT(A) up held the addition on the ground that the expenditure incurred only on account of personal effects hence not eligible deduction . On appeal the Tribunal held that the amount spent on cost of improvements to make the property habitable allowable as deduction and indexation while computing the capital gains however the amount spent on personal effects such as refrigerator, air conditioner LED, TVS furniture, dining table etc are not eligible for deduction. As regards interest capitalised the matter remanded to the file of Assessing Officer to verify whether the interest was claimed as deduction u/s. 24 of the Act for denovo verification in accordance with law . Referred Shrinivas R. Desai v. ACT (2013) 155 TTJ 743 (Ahd.)(Trib.). (ITA No.1200 & 1201/Mum/2020 dt.14-7-2022 (SMC). (AY. 2010 -11 )
Komal Gurumuk Sangtani v. ITO (Mum.)(Trib.) www.itatonline.org
Gurumukh I. Sangtani v. ITO (Mum.)(Trib.) www.itatonline.org

[Coram : Hon’ble Shri Vikas Awasthy, JM & Hon’ble Shri M. Balaganesh, AM]