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2017 (8) TMI 557 - AT - Income TaxTaxation in the hands of power of attorney - sale consideration of the land belonging to Shri Sultan Meena but taxed in the hands of assessee who is admittedly Power of Attorney holder of Shri Sultan Meena [land owner] - Held that:- Supreme Court in the case of Rambhau Namdeo Gajre v. Narayan Bapuji Dhotra [2004 (8) TMI 688 - Supreme Court Of India] has held that a power of attorney is not an instrument of transfer in regard to any right, title or interest in any immovable property. The power of attorney is a creation of an agency whereby the grantor authorizes the grantee to do acts specified therein, on behalf of grantor, which when executed will be binding on the grantor as if done and by him. Even if it is assumed that the assessee has received money and not handed over the same to the land owner such receipt is a liability not an income so far the assessee is concerned. Since, the Revenue has not brought any material on record suggesting that this power of attorney was executed in lieu of a consideration. In the absence of such material, purely, on the basis of presumption and suspicion tax liability cannot be fastened on such receipt on the assessee. - Decided in favour of assessee. Receipts earned from brokerage income - “income from other sources” or “business & profession” - Held that:- In both the years the income of the assessee in respect of brokerage is accepted by the Department, we find that AO has not made any inquiry from the persons from whom the assessee had received brokerage/commission. Under these facts, the AO was not justified in rejecting the claim of the assessee of earning brokerage/commission. Therefore, we direct the AO to treat the same as business receipt of the assessee and allow the expenditure made thereon. Hence, we deleted the addition made by the AO by treating the brokerage receipts as income from other sources and disallowing the expenditure incurred thereon. Hence, the net profit declared at ₹ 5,77,816.65 be treated as net profit from business of brokerage. Thus, this ground of assessee’s appeal is also allowed.
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