2015 (9) TMI 7 - AT - Income Tax

Treatment of cash seized in the course of search - assessment u/s 153A - Held that - Unexplained income arising out of Rs. 35, 00, 000 having been brought to tax in the hands of the assessee s husband Sri G. Janardhan Reddy the addition in the hands of the assessee is the case on hand is to be deleted as the same income cannot be taxed twice. In coming to this finding we are bolstered in our view by the Affidavit sworn to by Sri G. Janardhan Reddy to confirm that the same addition is accepted by him in his case and that no further appeal has been preferred in the matter - Decided in favour of assessee.

Summary

Issues:
1. Treatment of unexplained cash seized during a search.
2. Double taxation of the same income in different hands.

Issue 1: Treatment of unexplained cash seized during a search

The case involved an appeal by the Revenue against the order of the Commissioner of Income Tax (Appeals) for Assessment Year 2008-09. The assessee had disclosed additional income of Rs. 35,00,000 as per admission of undisclosed income, which included amounts related to property purchase and unexplained cash seized during a search. The CIT (Appeals) deleted the addition of Rs. 35,00,000 made on account of unexplained cash seized during the search. The Revenue contended that the amount was included in the return of income filed under Section 153A of the Income Tax Act. The Authorised Representative for the assessee argued that the same cash amount had already been taxed in the hands of the assessee's husband for the same assessment year. The CIT (Appeals) upheld the deletion of the addition, citing that the same income cannot be taxed twice. The Tribunal concurred with this finding and dismissed the Revenue's appeal.

Issue 2: Double taxation of the same income in different hands

The Tribunal considered the argument regarding double taxation of the same income in different hands. It was established that the seized cash amount of Rs. 35,00,000 had already been brought to tax in the hands of the assessee's husband for the same assessment year. The CIT (Appeals) had upheld the addition in the husband's case, and no further appeal was preferred. The Tribunal noted that the same income cannot be taxed twice, and therefore, the addition in the assessee's hands was deleted. The Affidavit sworn by the assessee's husband confirmed the acceptance of the addition in his case, further supporting the decision to dismiss the Revenue's appeal and the assessee's Cross Objections.

In conclusion, the Tribunal upheld the decision to delete the addition of unexplained cash seized during the search in the assessee's hands, considering the principle that the same income cannot be taxed twice. The judgment highlighted the importance of avoiding double taxation and ensuring fair treatment of income across different parties involved.