9911796707
TMI Blog1981 (3) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... led and the assessment was reopened by the ITO on the same day. The ITO completed the assessment under s. 143(3) of IT Act on29th March, 1978whereby he had computed the taxable income of the appellant at Rs. 99,782. While so computing the taxable income, the ITO added Rs. 75,000 towards unexplained investment. 2. We are only concerned with the merit of this addition of Rs. 75,000 in this appeal. The facts regarding to this addition are as follows: 3. In 1962, the appellant lent to M/s Indian Metal Industries an amount of Rs. 28,000 and she had procured pronote from the said firm in the name of her brother Shri Nawal Kishore benami for her. At the time of lending, Shri Surender Kumar Rastogi was one of the partners of the debtor firm. As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ale deeds was Rs. 75,000 on the dates of the sales but not Rs. 56,697 stated as the total sale price in those sale deeds. Even supposing the sale price of Rs. 56,697 was not the real market value of the property covered by the two sale deeds. Still, in our opinion, there were adequate reasons to hold that the property covered by the said deeds cannot fetch more than that price. In this connection, it may be mentioned that there is sufficient evidence on record to disclose that the property covered by the two sale deeds was not free from dispute. We have to take into consideration the fact that suit for recovery of possession and damages was filed regarding the same property by Shri Nawal Kishore on behalf of the appellant. Copies of plaint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce. There is no onus on the assessee to prove that the property is not worth more." 6. It was sought to be argued for the appellant that the decree cannot be said to be realised as appellant was not able to give possession of the sold property under the two sale deeds and she was driven to the necessity of filing a suit for that purpose. It is further sought to be contended that it is only when she would be able to realise possession of the property covered by the two sale deeds mentioned above. On that day only, she can be stated to have legally realised the amount under decree. This argument is stated to be rejected. We hold that the appellant should be deemed to have fully realised the fruits of her decree on the dates of her two sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the arguments of the appellant that utmost only Rs. 1,044 out of Rs. 56,697 can be brought to tax during this asst. yr. 1973-74 has no legs to stand. 7. We have considered the respective arguments advanced on both sides over this matter. We have duly taken into consideration made before the AAC by the appellant, in the form of the statement of facts a copy of which is provided at pages 30 to 33 of the paper book. At page 33 of the paper book, the appellant came forward with her explanation as to why she was not declaring her interest on accrual basis. Her case in this regard is as follows: "The appellant has been declaring her income from interest on the basis of accrual and since whole of the thing was in dispute and there was no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision, we gather the following facts of the case and the decision of the Hon ble High Court thereon: "The assessee had advanced a certain sum of money to a person on a mortgage deed in 1922 and a decree on the basis of that mortgage was passed by the High Court in 1934 giving effect to a compromise by which a sale deed of the entire mortgage property was to be executed in favour of the assessee within four months from the date of the High Court s decree and in that event the decree was to be fully satisfied. Possession was delivered to the assessee in the same year; but the sale deed was executed only on5th June, 1936. In the asst. yr. 1937-38 (Assessee s accounting year being November 1935 to November 1936) the IT Authorities held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceived by him; because in the case of such non-trader, until he gets the money, it is not part of his income. So, on the strength of the above authorities we hold that the interest accrued under the decree became income of the assessee only upon the fruits of the decree was realised i.e. on the date of the sale deeds mentioned above. Until then, it cannot be said to be a realised income more so because the appellant is a non-trader and did not employ and method of accounting. For the above reasons, we hold that the argument that the accrued interest should be spread to the back years and that such of the interest which was accrued during the previous year relevant to the asst. yr. 1973-74 only can be brought to tax cannot be upheld. Consequ ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
