Income Tax :- Rejection of Deduction u/s 80TTA by Income Tax Department.
Friends, Today I was shocked to view that Income Tax Department has rejected deduction of 80TTA in an assessment order of assessee for the assessment year 2013-14 vide which he was claimed deduction of 80TTA (Interest on Saving Bank account) with Nil Tax return. But Income Tax Department has raised tax demand in his assessment.
Initially, I was wandering to know the reason of rejection of income tax deduction of 80TTA then thought is there any limit in total income for deduction of 80TTA or not and found that there is no limit in total income for deduction. Deduction of 80TTA (interest on saving bank accounts) is allowable maximum to Rs. 10,000.00.
Finally, I have gone through the complete data of income tax return and found that assessee has not filled amount of Interest on Saving Bank in the Income Head "Income from Other Sources". All amount including salary+saving bank interest was filled in the Income Head "Income from Salary Head". It means Income from other sources was Nil. This was main reason for rejection of deduction of 80TTA. If assessee claims deduction of 80TTA then Income from other sources should not be less than the amount of deduction of 80TTA.