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2021 (1) TMI 33 - AT - Income TaxNature of amount received after quitting the job - consultancy service or salary- difference in income disclosed in his return and form 26AS - expenditure incurred by the assessee towards earning income from providing consultancy services - HELD THAT:- It is not in dispute that the amount received by the assessee of ₹ 35,31,392/- is from consultancy services. For rendering such services, it is obvious that the assessee would have definitely incurred expenditure. Therefore it would be appropriate and just to estimate the expenditure and thereafter determine the taxable income of the assessee. Further taking cue from the provisions of section 44ADA of the Act (though it was inserted by finance Act 2016 w.e.f. 1/4/2017). In the peculiar circumstances in the case of the assessee 50% of the gross consultancy receipts should be treated as the expenditure incurred by the assessee for earning income from consultancy services. Accordingly, we hereby direct the Ld. AO to grant deduction of ₹ 17,65,696/- (½ of ₹ 35,31,392/-) towards the expenditure incurred by the assessee towards earning income from providing consultancy services while computing the income of the assessee under the head "income from profession" and treat the balance amount of ₹ 40,42,376/- as income under the head "salary". It is ordered accordingly.
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