TMI Blog2015 (1) TMI 392X X X X Extracts X X X X X X X X Extracts X X X X ..... ness carried on by the assessee. No evidence has been brought on record by the A.O to establish that the assessee was doing any other activity other than the business in gold ornaments, etc. for which the amount was disclosed. It is, therefore, clear that the amount disclosed is nothing but, the business income of the assessee. - Now, when the business activity of the assessee has been accepted and no other source of income is found, then there was no justification for disallowing the salary paid to Partners at ₹ 4.50 Lacs. Therefore, the disallowance of ₹ 4.50 Lacs granted by the A.O and confirmed by the Tribunal is erroneous and deserves to be quashed and set aside. - Following decision of Md. Serajuddin & Bros. v. Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel appearing for the assessee submitted that the entire disallowance of ₹ 4.50 Lacs made by the A.O u/s.40(b) of the Act and confirmed by the Tribunal is on the basis that the assessee had offerred ₹ 15,12,264/- during the course of survey as disclosure of unexplained / unaccounted income of business, which has not been accepted by the A.O as income from business during survey at the business premises of the appellant. It was submitted that the entire disallowance u/s.40(b) is based on the addition of excess stock and hence, the natural presumption is that whatever additional income is assessible, should be assessed under the head income from business / profession specially when no other capital asset is sold by the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... computed under the head profit and gains of business or profession. 27. Thus it emerges as follows: Even if the income from other sources is included in the profit and loss accounts to ascertain the net profit qua book profit for computation of the remuneration of the partners the same cannot be discarded. 3.3 Learned counsel Mr. Patel submitted that the principle rendered in the aforesaid decision shall squarely govern the issue on hand and therefore, the impugned judgment and order of the Tribunal deserves to be quashed and set aside and the order passed by the CIT(A) deserves to be restored. 4. Mr. KM Parikh learned Standing Counsel appearing for the Revenue submitted that the assessee had credited an amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing any other source of income? 6. We have heard learned counsel for both the sides. It appears from the Assessment Order that there is nothing to conclusively establish that the amount offered for taxation in the return of income and credited in the books of account is not the business income of the assessee. The A.O who recorded the statement of the assessee u/s.131 did not question the source of income of assessee in respect of the disclosed income. Therefore, the stock, cash, etc. found during the course of survey indicate that the income disclosed is in respect of the business carried on by the assessee. No evidence has been brought on record by the A.O to establish that the assessee was doing any other activity other than the busi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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