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2016 (12) TMI 1403 - AT - Income TaxN.P. estimation - Held that:- Estimation of net profit of 5% on total stock put for sale net of all deductions is reasonable. Unexplained sources for opening capital brought forward from previous years - Held that:- Assessee failed to prove genuineness of the transactions and creditworthiness of the parties. Although, the assessee filed confirmation letters from the creditors, all the confirmation letters are in prototype form without any details as to how the loan was accepted. Though assessee claims to have accepted the loan from agriculturists, fails to prove the sources of the creditors to substantiate the creditworthiness of the parties. Thus the assessee has failed to discharge its initial onus cast upon him by furnishing necessary identity, creditworthiness of the parties and genuineness of the transactions. In so far as additions towards opening capital is concerned, though assessee claims to have explained the sources for opening capital out of his past savings, the assessee failed to prove the sources with necessary evidences. The assessee claims to have savings out of his salary income, however, on perusal of the submissions of the assessee, the assessee himself admitted that he was working with a meager salary of ₹ 10,000/- per month. The assessee failed to demonstrate how with a meager salary of ₹ 10,000/- per month could show such a huge opening of capital of ₹ 8,14,500/-. Therefore, we are of the view that the assessee failed to prove the sources for opening capital brought forward from previous years and accordingly, the A.O. has rightly made additions. Unexplained amount being difference between initial expenditure incurred and sources in the form of unexplained credits and opening capital balance - Held that:- We find that the assessee had been given sufficient opportunity to explain the case before the A.O. Though sufficient opportunity has been given, the assessee failed to file necessary evidences to prove his case. Even before CIT(A), the assessee failed to file necessary evidences to justify the additions made by the A.O. Therefore, we are of the view that there is no merit in the claim of the assessee for one more opportunity of hearing and accordingly the same is rejected. Additions towards income from other sources being interest received on fixed deposits - Held that:- No merits in the arguments of the assessee for the reason that at any stretch of imagination interest from fixed deposit whether or not the said deposits are kept for obtaining bank guarantee cannot be considered as income from business. Therefore, we are of the view that the A.O. has rightly taxed interest income under the head income from other sources. Accordingly, the addition made by the A.O. is upheld.
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