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2015 (9) TMI 956 - AT - Income TaxDouble addition of the same amount in both the assessee and assessee’s wife - receipts estimated on hospital - Held that:- Department did not have any evidence of suppression of receipts. It may be altogether a different issue that assessee has not maintained any Books of Account nor the hospital has any records. The only in-patient diary was available without any fee received or amount spent. It was the contention that hospital not only undertakes the room charges and nursing charges but also consultation fee of the doctors which was passed on to respective persons. As far as assessee is concerned, he is only a specialized doctor for the hospital being run in his wife’s name and surgical fee is received by him. There is no evidence of how many patients are surgery patients and how many are non-surgery patients. Therefore, AO has taken up roughly at about 25% as non-surgery cases as the nursing home was mainly run under the guidance of assessee being a surgeon. Since neither party is able to furnish any evidence with reference to actual number of surgeries being done, the reasonable estimation of the AO cannot be faulted. Therefore, the bifurcation adopted by the AO in the respective years out of the total patients is however, upheld. On issue of estimation of fee received in surgery cases and non-surgery cases, it seems the amounts are on higher side. In one of the statements recorded from the patient there is a signed proforma for claim of reimbursement of medical expenditure in which surgery fee was shown at ₹ 3,500/-. Based on that, it is fairly reasonable to estimate that amount as fee received for surgery in that year. Based on the above, the receipts from surgery in AY. 2004-05 would be at ₹ 10 Lakhs (4,000 X 2,500), in AY. 2005-06 at ₹ 11,49,000/- (383 X 3,000) and in AY. 2006-07 at ₹ 6,93,000/-. The estimation submitted by assessee at our instance is based on the statement from which the surgery fee at ₹ 3,500/- could be inferred. Accepting the same, with reference to non-surgery fee also, the total receipts per year can be determined. - Decided partly in favour of assessee. Assessment u/s. 153C - Held that:- The only incriminating material which AO considered is with reference to inpatient register of the hospital, based on which receipts were estimated by the AO. Apart from that there was no incriminating material on any other issue. Since there is some incriminating material and as the AO was satisfied that in-patient register pertains to the hospital being run by assessee, we are of the opinion that proceedings U/s. 153C were validly initiated. Assessee is questioning that proceedings U/s. 153C were initiated without any satisfaction. Even though this ground was raised no evidence was placed by either party in order to examine this aspect. Therefore, the grounds are considered as not validly raised. However, while making the additions, the aspect that proceedings U/s. 153C were initiated and completed has been kept in mind, as any addition without any corresponding incriminating material may not be sustained. Estimation of receipts - Held that:- Considering the estimations adopted by the AO, clarification given by assessee and the evidences on record, we are of the opinion that assessee might be passing on the receipts to others. Substantial part was towards Doctors which was separately considered in Dr. S V Prasad hand. Considering the receipts accounted and ratio of expenditure claimed, we are of the opinion that estimation of net receipts can be considered by increasing the receipts by another 50% i.e., about ₹ 3,50,000/- in AY. 2004-05, ₹ 4,30,000/- in AY. 2005-06. In AY 2006-07 the in-patient register shows less number of patients. Assessee has shown substantial increase in receipts already. Keeping that in mind an amount of ₹ 2,00,000 can be estimated to be additional receipts in assessee case. The reasons given in the husband’s appeals in estimation will equally apply here. We are of the opinion that the above estimation will meet the ends of justice as there is no addition to wealth identified in search. AO is directed to modify the orders accordingly. Capital Gains - Held that:- This issue arises in AY. 2003-04. The facts are similar to the facts discussed in the case of Dr. S. Venkateswara Prasad above for AY. 2003-04. For the reasons stated therein, since assessee has got possession in the year relevant to AY. 2004-05, the capital gains cannot be brought to tax in AY. 2003-04, accordingly, the grounds are allowed. AO is directed to delete the amount made as an addition in this year. Agricultural Income - Held that:- There is lot of variation of the agricultural income depending on the agricultural holdings. Assessee’s husband Dr. S. Venkateswara Prasad also offered agricultural income and the same was accepted as such. Keeping that in mind and also the fact that no incriminating material was found and proceedings are u/s 153C, we are of the opinion that action of the AO cannot be upheld. He is directed to accept the agricultural income as offered by assessee.
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