TMI Blog2017 (11) TMI 999X X X X Extracts X X X X X X X X Extracts X X X X ..... that ₹ 1 lakh is not such a big amount as could not be contributed by five persons and in the absence of any material the AO should have accepted the contention of the assessee. Addition of pigmy savings of the daughter of the assessee and the other amount as compensation from Insurance Company - Held that:- In so far as the compensation from Insurance Company is concerned the assessee could have produced the relevant documents. However, we cannot expect any such evidence in respect of ₹ 38,085/- and the pigmy savings of the daughter of the assessee cannot be termed as income of the daughter so as to club such income with the income of the assessee. Such savings of the daughter could obviously be out of the amounts provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT (A) as satisfactory and find it difficult to sustain the same. We consider that it is a fit case to restore the ground to the file of the AO for verification of the facts pleaded by the assessee and to give a fresh finding. We, therefore, remand this ground to the file of the AO to verify whether the recipients of the interest amount have paid the advance tax and self assessment tax in respect of this particular interest amount by giving an opportunity to the assessee of being heard. Disallowance towards 10% of the total expenses on the ground that the same is attributable to the personal use of telephone and travelling expense - Held that:- In so far as telephone is concerned, we agree with the authorities below but in so far as tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee which ought not to have been treated it as Income of the assessee. 4. That the Ld. Commissioner of Income Tax (Appeal) had erred in law as well as on facts of the case in sustaining the addition of ₹ 1,82,505/- being unexplained entries in Bank A/c, addition which ought not to have been sustained by the Ld. Commissioner of Income Tax (Appeal). 5. That the Ld. Commissioner of Income Tax (Appeal) had erred in law as well as on facts of the case in sustaining the addition of ₹ 7,831/- being 10% of business expenditure u/s 37(1) of Income Tax Act, addition which ought not to have been sustained by the Ld. Commissioner of Income Tax (Appeal). 2. Briefly stated, the facts are that the assessee is deriving i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,085/- was the maturity amount of pigmy saving account opened on the name of his daughter and ₹ 27,500/- was the compensation from Insurance Company. AO did not accept this explanation of the assessee and holding that there was no evidence explaining the other cash credit amounts also, and placing reliance on the decision reported in Gumani Ram Siri Ram vs. CIT (1975) 98 ITR 337 (P H). AO made the addition of the entire amount. Ld. CIT (A) agreed with the AO and sustained the additions made. 4. It is the argument of the Ld. AR that both the parties below recorded that the assessee produced the affidavits of the lenders of ₹ 1 lakh but only on suspicion as to their financial capacity the addition was made without pointing out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the absence of any material the AO should have accepted the contention of the assessee. 5. Now coming to the addition of ₹ 1,82,505/-, assessee explained only two amounts i.e. ₹ 38,085/- and ₹ 27,500/- as the amounts relating to pigmy savings of the daughter of the assessee and the other amount as compensation from Insurance Company. In so far as the compensation from Insurance Company is concerned the assessee could have produced the relevant documents. However, we cannot expect any such evidence in respect of ₹ 38,085/- and the pigmy savings of the daughter of the assessee cannot be termed as income of the daughter so as to club such income with the income of the assessee. Such savings of the daughter could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the effect that the persons to whom the interest was paid by the assessee had paid the advance tax and self assessment tax over and above the tax payable, thereby not causing any loss to the Revenue and the Revenue is permitted to levy interest u/s 201(1A) even in a case where the person liable to tax has paid tax on due date, as such, if the interest expenses is disallowed it would cause undue benefit to the Revenue. There was a clear assertion by the assessee before the Ld. CIT (A) that since the deductee-assessee had paid due taxes in time on the interest income received from the assessee and duly shown in their respective return, the payment of interest cannot be treated as income of the assessee and hence, addition made on this aspec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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