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2016 (7) TMI 13 - AT - Income TaxEstimation of business income without giving credit for the declaration made under the Voluntary Disclosure of Income Scheme [VDIS] - CIT (Appeals) has denied the benefit of declaration in the VDIS, 1997 on the ground that the assessee has failed to furnish the certificate issued by the competent authority under Section 68 (2) of VDIS, 1997 - Held that:- Merely because the concerned authority has not issued a certificate under Section 68(2), the fact of filing of disclosure of the income cannot be negated. We find that the assessee has declared income of ₹ 3,20,000 for the Assessment Year 1996-97 under VDIS, 1997 on account of investment in agricultural land, motor cycle and cash. The Assessing Officer has proceeded to estimate the business income of the assessee on the ground of household expenses and household investment of goods but the finding of the Assessing Officer is vague without giving any details of household expenditure and the alleged investment in household goods. As it is clear from the concluding part of the Assessing Officer that while estimating the business income of the assessee, the Assessing Officer has not given any reference of household expenditure, telephone expenditure and investment in household goods. Therefore in the absence of any tangible material to show that the assessee has incurred the expenditure to the extent of ₹ 3 lakhs, the estimation made by the Assessing Officer is only a guess work without supporting evidence. Since the assessee has already declared a sum of ₹ 3,20,000 under VDIS, 1997, therefore to the extent of said sum, no addition can be made as per the provisions of section 68 of the said scheme. In the facts and circumstances of the case and in view of the declaration of ₹ 3,20,000 as income under the VDIS, 1997 for the year under consideration, we delete the addition made by the Assessing Officer - Decided in favour of assessee. Unexplained cash credit under Section 68 - Held that:- There is no dispute that the assessee declared total cash of ₹ 1,57,500 comprising of ₹ 67,500 for the Assessment Year 1996-97 and ₹ 90,000 for the Assessment Year 1997-98. Therefore the cash in the bank account of the assessee to the extent of ₹ 1,20,000 is covered by the declaration made by the assessee of cash to the extent of ₹ 1,57,500 and accordingly, no addition can be made on account of cash found with the assessee to the extent of the said amount declared in the VDIS,1997. It is not the case of the Assessing Officer that apart from the cash found in the bank, the cash declared in the VDIS was also found with the assessee. Therefore in the absence of any other amount found by the Assessing Officer in cash the addition of ₹ 1,20,000 as unexplained cash credit under Section 68 cannot be made in view of the declaration made in the VDIS, 1997. Accordingly, we delete the addition made by the Assessing Officer on this count. - Decided in favour of assessee.
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