1979 (11) TMI 119 - AT - Income Tax

Summary

Issues Involved:
1. Suppressed professional receipts and low withdrawals for household expenses for various assessment years.
2. Unexplained investment in a fixed deposit in the name of the father of the assessee.
3. Unexplained investment in gold ornaments and jewelry.

Detailed Analysis:

1. Suppressed Professional Receipts and Low Withdrawals for Household Expenses:

Assessment Year 1971-72:
The primary issue was whether the AAC erred in reducing the addition made by the ITO on account of suppressed professional receipts linked with low withdrawals for household expenses from Rs. 6,524 to Rs. 1,000. The ITO initially estimated suppressed professional receipts at 20% of gross receipts, amounting to Rs. 13,047, based on discrepancies found during a search under s. 132 of the IT Act. The AAC, however, found that the receipts from outdoor patients were minimal and reduced the addition to Rs. 1,000. The Tribunal upheld the AAC's decision, stating there was no basis for the ITO's estimate and dismissed the appeal.

Assessment Year 1972-73:
The ITO determined suppressed professional income at Rs. 12,000. The AAC reduced this to Rs. 1,000, which the Tribunal confirmed, noting that irregularities found in the previous year could not justify assumptions for subsequent years.

Assessment Year 1973-74:
The ITO made an addition of Rs. 12,000, which the AAC reduced to Rs. 10,000. The Tribunal upheld the AAC's reduction to Rs. 1,000, consistent with its earlier decisions.

Assessment Year 1974-75:
Similar grounds were raised as in previous years. The ITO's addition was reduced by the AAC to Rs. 1,000, and the Tribunal confirmed this reduction.

Assessment Year 1975-76:
The Tribunal dismissed the appeal, confirming the AAC's reduction of the ITO's addition to Rs. 1,000 for consistency with previous years.

2. Unexplained Investment in Fixed Deposit:

Assessment Year 1972-73:
The ITO added Rs. 20,000 as unexplained investment in a fixed deposit in the name of the father of the assessee. The AAC found that the father of the assessee was a man of means and the deposit belonged to him, not the assessee. The Tribunal upheld this finding, noting affidavits and statements supporting the AAC's conclusion.

Assessment Year 1973-74:
The AAC's deletion of the addition made by the ITO on account of interest on the fixed deposit was upheld by the Tribunal, as the sum of Rs. 20,000 did not belong to the assessee.

Assessment Year 1974-75 and 1975-76:
Similar grounds were raised, and the Tribunal confirmed the AAC's deletion of the addition for these years as well.

3. Unexplained Investment in Gold Ornaments and Jewelry:

Assessment Year 1976-77:
Gold ornaments weighing 1298 grams and jewelry valued at Rs. 8,725 were found during a search. The ITO held these as acquired from undisclosed income, valuing them at Rs. 46,300. The AAC, however, accepted the assessee's explanation that the gold and jewelry were received as "Streedhan" and were satisfactorily explained. The Tribunal upheld the AAC's decision, noting affidavits and statements that supported the assessee's claim.

Conclusion:
The Tribunal upheld the AAC's decisions across all assessment years, confirming reductions in additions made by the ITO for suppressed professional receipts and low withdrawals for household expenses, the unexplained fixed deposit, and the gold ornaments and jewelry. All appeals filed by the Revenue were dismissed.