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2023 (8) TMI 289 - AT - Income TaxCorrect head of income - receivables / debtors found during the course of survey u/s 133A - business income or deemed income u/s 69 - Applicability of higher rate of tax u/s 115BBE - HELD THAT:- As it is a case where there are unrecorded sales made by the assessee during the current financial year and receivables arising out of such unrecorded sales have been offered to tax as additional business income by the assessee. The source of such unrecorded receivables is thus the unrecorded sales which have been explained by the assessee and thus, the necessary nexus with the business of the assessee has been established. The name of the person, the amount receivables, date, etc has been duly recorded in the diary, thus, the statement of the assessee duly stand corroborated by the contents of the diary so found during the course of survey. No doubts, these transactions were not recorded at the time of survey thus qualify as unrecorded transactions satisfying one of the essential conditions, at the same time, the assessee has provided the necessary explanation about the nature and source of such unrecorded transactions, thus, it cannot be said that these are unexplained transactions thus, doesn’t satisfy the second condition for invoking the deeming provisions of section 69 of the Act. Income surrendered during the course of survey cannot be brought to tax under the deeming provisions of section 69 of the Act and the same has been rightly offered to tax under the head “business income” and as a necessary corollary, in absence of deeming provisions, the question of application of section 115BBE doesn’t arise for consideration. Decided in favour of assessee.
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