The assessee was engaged in the business of running a hotel and made investments in V Hotels. It borrowed funds from a co-operative bank for the purpose of making investments in V Hotels. He declared interest from other sources and claimed deduction of the interest paid on unsecured loans and on bank loans and set off the resultant loss against the income from other sources, business and capital gains under S.\u00a071\u00a0of the\u00a0Act. \u00a0which the AO. \u00a0The CIT(A) deleted the disallowance. \u00a0On appeal \u00a0the Tribunal held that \u00a0the assessee had borrowed the funds and made investments in the business. The AO \u00a0did not make out a case that the assessee had diverted the funds for non-business purpose. \u00a0Business consideration was the decision of the assessee and not the AO. \u00a0The assessee made the investments for the purpose of business and paid the interest. \u00a0The income under the head \u201cIncome from other sources\u201d resulted in a loss which was claimed for set off under section 71. \u00a0Intra head losses were allowable to be set off against other sources of income in the same assessment year. \u00a0Therefore the addition was deleted. \u00a0(AY. \u00a0\u00a02012-13\u00a0 2013-14).<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 71 : Set off loss-One head against income from another-Borrowing funds and making investments in business also paying interest-No evidence assessee diverted funds for non-business purpose-Intra head losses can be set off.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-8633","post","type-post","status-publish","format-standard","hentry","category-digest"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-2ff","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/8633","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=8633"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/8633\/revisions"}],"predecessor-version":[{"id":8634,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/8633\/revisions\/8634"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=8633"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=8633"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=8633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}