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2021 (5) TMI 482 - AT - Income TaxUndisclosed income u/s 68 - computation of tax liability under the provisions of section 115 BBE - Addition based on notebooks found in search - assessee admitted that the said notebook contains entries relating to his business concern and declared the additional income during the survey action - case was selected for scrutiny and the AO passed assessment order u/s 143 (3) and accepted the return - HELD THAT:- Section 68 of the Act, applies where any sum is found credited in the books of account maintained by the assessee for any previous year and the assessee fails offer any explanation about the nature and source thereof or the explanation by the assessee is not satisfactory in the opinion of the AO, the sum so credited may be treated as income of the assessee of that previous year. In the present case the assessee has explained the nature and source of the amount in question and to substantiate his contention submitted cash flow statement - AO has not given his findings on this point. We, therefore, find merit in the contention of the assessee that in the absence of any adverse findings by the AO on the source of earning of the assessee, the authorities below have wrongly treated the amount in question as undisclosed income u/s 68 of the Act and computed the Tax liability under the provisions of section 115 BBE of the Act. We are of the considered view, the sole ground raised by the assessee is covered in favour of the assessee by the decision of the coordinate Bench in the case of Shri Bhuwan Goyal [2020 (10) TMI 27 - ITAT CHANDIGARH]. CIT(A) has erred in upholding the action of the AO in treating the amount in question as undisclosed income u/s 68 of the Act. Hence, respectfully following the decision of the coordinate Bench in the case discussed above, we allow the appeal of the assessee and set aside the impugned order passed by the Ld. CIT(A). Accordingly, we direct the AO to compute the Tax on the said amount treating the same as business income of the assessee. Appeal of the assessee is allowed.
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