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2022 (3) TMI 425 - AT - Income TaxClubbing of Income - Addition of Rental Income earned by the Spouse of the Assessee, in the hands of the Assessee, U/s 64 - Unexplained investment - disallowing the rent paid to spouse by the Assessee, as his investment/funding towards the purchase of the Property - as per CIT-A no substantial taxable income shown by appellant’s wife during the above assessment years Through which she can make investment in her own capacity either in the property or in the mutual funds etc. - HELD THAT:- The assessee’s wife who has low returned income but received loan from the assessee and she has repaid the loan from the redemption of mutual funds and liquidation of fixed deposits. There is no bar on the part of the assessee to extend loan from his known sources of income to his wife. Similarly, there is no bar on the assessee’s wife to repay the loan from her own mutual funds and fixed deposits. The assessee has paid house rent and the recipient, the assessee’s wife has declared the same under the head “income from house property” in her returns which has been accepted by the revenue. The copy of which has been placed before us. The house has been registered in the name of Smt. Shivani Bansal. CIT(A)’s observation that the assessee has got meager income hence he cannot afford to purchase a house cannot be accepted as the sources for purchase of the house in the hands of Smt. Shivani Bansal are proved rather never doubted. The ld. CIT(A)’s contention that the husband cannot pay rent to the wife is devoid of any legal implication supporting any such contention. Hence, keeping in view the entire facts of the case, we hereby allow the appeal of the assessee.
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