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TMI Blog2022 (10) TMI 374X X X X Extracts X X X X X X X X Extracts X X X X ..... ity upon the assessee which cannot be allowed at all. The impugned order of the CIT(A) is set aside and the matter is restored to the file of the Assessing Officer with a direction that the AO will assess the income of the assessee under different heads as per the provisions of the Act, after considering the submissions of the assessee in this respect and after giving adequate and proper opportunity to the assessee to present his case and necessary details and evidences. It is made clear that the Assessing Officer will not be influenced by the fact that the assessee himself has offered/returned any of the receipts/income under wrong head or has himself offered higher taxes in respect of certain income. The Assessing Officer will determine the true and correct income of the assessee under different heads as per the provisions of the Act. The appeal of the assessee is treated as allowed for statistical purposes. - I.T.A. No. 1270/CHANDI/2018 I.T.A. No. 34/CHANDI/2020 - - - Dated:- 22-9-2022 - Shri Sanjay Garg , Judicial Member Shri Vibhore Garg , CA , appeared on behalf of the appellant Smt. Amanpreet Kaur , Sr. DR , appeared on behalf of the respondent ORDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the income already offered for taxation has not been given the benefit/credit whereas the same amounts have been added back again treating the same as income hence double addition. 5. Because the prayer is for kindly allowing any addition, modification, deletion, amendment in the grounds of appeal along with the consequential benefit thereon before the disposal of the appeal in the interest of substantial justice for a decision in accordance with law. 3. The brief facts of the case are that the assessee filed the return declaring business income of Rs.4,80,000/- u/s 44AD on gross turnover of Rs.55,59,108/- and net taxable income of Rs.3,22,090/-. During the assessment proceedings, the Ld. Assessing Officer enquired about details of gross receipts declared u/s 44AD. The assessee declared gross receipts as under: Turnover of future and options 35,16,210/- Sale of property 7,31,050/- Commission income 6,91,748/- Unsecured loans surrendered 6,20,100/- Total 55,59,108/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceipts from sale of property which can only be taxed under Capital Gains more so when assessee is not working in real estate business. Instead of treating the sale of property under proper head AO kept silent on the issue and further erred in treating the same u/s 44AD where income is declared @8%. The entire assessment is based on taking punitive action against the assessee because the assessee had inadvertently mentioned that the commission income at Rs.13,11, 848/- which was later on corrected by the assessee vide his reply dated 16.06.2017 clarifying that the receipts on account of commission is Rs.6,91,748/- and unsecured loans are Rs.6,20,100/-. The assessee even filed a duly sworn in affidavit to clarify his stand. The Ld AO has pierced the deeming fiction of section 44AD where expenses allowed under section 28 to section 43C are deemed to be allowed and net income of 8%/6% is taken as net taxable income. Once Assessing Officer has pierced into the deeming fiction and proceeded to address individual sources separately, then he cannot pick and choose on other sources. A.O has to address the issue in totality which he has failed miserably. The Ld. A.O ended up in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his receipts u/s 44AD of the Act and offered the entire receipts @8%/6% tax on presumptive basis. However, the Assessing Officer found that entire income of the assessee was not eligible to be offered for taxation at fixed rate on presumptive basis u/s 44AD of the Act. He, however, instead of assessing the income of the assessee under the different heads as per the provisions of Income Tax Act, adopted pick and choose manner and only excluded the income wherein, the tax liability was increased such as commission income and unsecured loans, whereas income assessable under the other heads i.e. receipt from sale of property and loss from future options has not been assessed by the Assessing Officer under relevant heads. In this case, the Assessing Officer on the one hand has taken advantage of the ignorance of the assessee in offering the income on presumptive basis and taxed the receipts where the assessee was not supposed to pay the taxes, however, picked the other income whereupon the Assessing Officer found that the same was exigible to higher taxes. This, in my view, cannot be held justified at all. It has been held time and again that the Assessing Officer should help the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount belong to Mrs Hem Lata mother-in law of the assessee. The assessee had declared the amount u/s 44AD due to lack of knowledge of tax laws. The amount could have been simply declared as gift from mother in law. Further the ld A.O added the commission income of Rs.4,73, 644/-to be out of the purview of Section 44AD and further observed that the assessee failed to establish commission agency business and treated the same to be unaccounted money u/s 69A read with section 115BBE. Further the Ld A.O rejected the plea of the assessee regarding the forfeiture of advance amounting to Rs.3,00,000/- and added the same as unaccounted money u/s 69A read with section 115BBE ignoring the evidence placed on record merely as a punitive measure. The amount of Rs 3, 00,000/- is taxable u/s 56(2)(ix) inserted w.e.f 01.04.2015. The AO ignored the receipts of Rs 58,56,350 from trading in Futures and Options in which assessee had incurred loss of Rs.6,52,315/- even after specifically being pointed out by the assessee vide his letter dated 03.12.2018. Instead of allowing loss in trading of future and options, Ld A.O kept silent on this issue and further erred in treating the ..... 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