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TMI Blog2023 (1) TMI 271X X X X Extracts X X X X X X X X Extracts X X X X ..... han reasonable/lenient in allowing 40% of undisclosed professional receipts as deduction towards undisclosed/unrecorded expenses , from undisclosed professional receipts. The assessee has also claimed that some of the expenses were paid in next year such as fee of juniors, although no evidence is brought on record by assessee , while the onus was squarely on the assessee to have brought evidence on record. Thus, in our considered view already an extremely liberal view has been taken by ld. CIT(A) in granting part relief to the assessee as above and no further relief can be granted to the assessee keeping in view the facts and circumstances of the case as there is no availability of funds/cash to meet any further unrecorded expenses, and hence the appeal filed by the assessee stands dismissed. Interest income credited by SBI In assessee s undisclosed bank account maintained with SBI, High Court Branch, Allahabad , which was not offered to tax by the assessee, while filing return of income - We do not find any error in the orders of authorities below in bringing to tax said interest income in the hands of the assessee , as the said bank account pertains to the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e contrary to the actual facts of the case. 3- That in any view of the matter agriculture income of Rs. 2 lacs disclosed by the appellant as per past practice as considered and confirmed as professional receipt by the two lower authorities without appreciating the correct facts, specially when proof of agriculture holdings was placed on record, is highly unjustified and illegal, hence the addition is liable to be deleted in the facts and circumstances of the case. 4-That in any view of the matter since the income declared as per revised computation is liable to be considered therefore the additions so made and maintained in haste ignoring the correct facts by the two lower authorities are liable to be deleted in all fairness and in interest of justice. 5- That in any view of the matter the interest as charged under different sections of the IT Act is highly unjustified and illegal. 6-That in any view of the matter the appellant reserves his right to take any fresh ground before hearing of the appeal. 3. The brief facts of the case are that the assessee has claimed to be an advocate practicing for last more than 20 years before Hon ble Allahabad High Court,b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the AO that the assessee has deposited Rs. 31,86,420/- in cash in State Bank of India, High Court Branch, Allahabad in his Bank Account No. 30747477708 which was not disclosed/declared by the assessee to the Department. The said bank account is in the name of the assessee, and the entire cash deposit was not declared and disclosed to the department. The assessee was asked by AO to explain the same. The assessee submitted that due to clerical error which occurred inadvertently , the above bank account was not accounted for at the time of filing of income tax returns and hence the same was not disclosed to the department. The assessee claimed that there are so many expenses which were incurred by the assessee such as stamp duty, court fee, notarial charges etc. for which receipts are not available, but the same are to be allowed as deduction. The assessee submitted that around 60% of the cash deposit of Rs. 31,86,420/- should be allowed as deduction towards professional expenditure, while 40% of the said cash deposit of Rs. 31,86,420/- can be treated as income. There was credit of Rs. 58,498/- towards interest income on the aforesaid saving bank account no. 30747477708 with SBI, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash income of Rs. 2,00,000/- as professional receipts of the assessee, and added back the same to the income of the assessee u/s 68 of the 1961 Act. 4.1. Being aggrieved by assessment framed by the AO, the assessee filed first appeal with Ld. CIT(A) . Ultimately, the assessee could not prove and substantiate satisfactorily the receipt of Rs. 12,00,000/-in cash from her wife Mrs. Abha Gautam, which stood credited in his capital account . Further, the assessee also could not prove and substantiate satisfactorily receipt of gifts in cash from his relatives to the tune of Rs. 19,50,000/- , which stood credited to the capital account of the assessee. Further, the assessee also could not prove and substantiate satisfactorily deposit of cash to the tune of Rs. 31,86,420/- ( net amount of Rs. 31,65,836/- after adjustment of bank charges to the tune of Rs. 20,584/- debited by bank ) in his undisclosed bank account bearing number 30747477708 maintained with SBI, High Court Branch , Allahabad . Further ,the assessee could not prove satisfactorily the cash receipt of Rs. 2,00,000/- as agricultural income which stood shown in the return of income. The ld. CIT(A) treated all these aforesaid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said receipts as undisclosed professional receipts but allowed 40% expenses from these undisclosed professional receipts while balance 60% was treated as income from profession and brought to tax. It was submitted that so far as relief granted by ld. CIT(A) is concerned , the same has attained finality as Revenue has not come in appeal before tribunal against part relief granted by ld. CIT(A) nor C.O. is filed by Revenue before tribunal. The ld. Sr. DR also could not point out that Revenue has come in appeal before the tribunal against the part relief granted by ld. CIT(A) nor it could be shown that department has filed any C.O.. The Ld. Counsel for the assessee submitted that the assessee is not contesting treatment of aforesaid credits/receipts as professional receipts as the assessee is not agitating the same , but the assessee is praying that 60% of the said undisclosed professional receipts should be allowed as deduction towards expenses incurred for earning the said undisclosed professional receipts , while 40% of the same can be brought to tax .It was submitted that revised computation of income was filed before the AO. It was also submitted that in the light of Section 44AD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellate order passed by ld. CIT(A) , and prayers were made to uphold the appellate order passed by ld. CIT(A) 5c. The Ld. Counsel for the assessee submitted in rejoinder that the assessee is an advocate and lenient view should be taken. 6. We have considered rival contentions and perused the material on record. We have observed that the assessee has claimed to be an advocate of standing of more than 20 years, appearing before Hon ble Allahabad Bench and Lucknow Bench of Hon ble Allahabad High Court. The assessee has earned professional receipts as well income from other sources. The case of the assessee was selected by Revenue for framing scrutiny assessment. It transpired from the 26AS generated from AST software and AIR information that there were cash deposits in the assessee s bank account to the tune of Rs. 30,97,470/- , during the year under consideration . During the course of assessment proceedings, the assessee was called upon by AO to explain the said cash deposits in the bank account. The assessee initially submitted before the AO that he has not deposited cash to the tune of Rs. 30,97,470/- in the bank account . The AO collected information directly from the Bank. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of income. The assessee on being asked by AO, could not satisfactorily explain as to the ownership of land in his name, receipts issued for agricultural produce nor the assessee could prove carrying out of agricultural operations for earning agricultural income , and the said alleged agricultural income of Rs. 2,00,000/- was brought to tax by the AO as undisclosed professional income of the assessee, by invoking provisions of Section 68. The AO also brought to tax interest income of Rs. 58,498/- credited by SBI In assessee s undisclosed bank account no. 30747477708 maintained with SBI, High Court Branch , Allahabad , which was not offered to tax by the assessee, while filing return of income. The matter reached ld. CIT(A) at the behest of the assessee. The assessee could not offer any satisfactory explanation before ld. CIT(A), who was pleased to upheld the decision of the AO so far as treating cash deposit of Rs. 31,65,836/- in undisclosed bank account of the assessee bearing bank account number 30747477708 maintained with SBI, High Court Branch , Allahabad, Rs. 12,00,000/- as cash allegedly received from assessee s wife Mrs. Abha Gautam being credited by assessee in his capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome chargeable to tax w.r.t. undisclosed professional receipts . Further, it is claimed that the assessee has withdrawn Rs. 6,00,000/- in cash from this undisclosed bank account of the assessee maintained with SBI, which is claimed to be spent towards expenses for earning aforesaid undisclosed professional receipts. Further, it is claimed that some expenses to junior advocates were paid in subsequent year but these expenses related to the year under consideration and hence deduction should be allowed in the year under consideraiton. While, the ld. Sr. DR relied upon appellate order passed by ld. CIT(A) and contentions are raised that already ld. CIT(A) was more than reasonable in granting deduction towards expenses to the tune of 40% against undisclosed professional receipts, and no further deduction be allowed to the assessee. The prayers were made by ld. Sr. DR to sustain the appellate order passed by ld. CIT(A). We have gone through the entire bank statement of undisclosed bank account bearing number 30747477708 maintained by the assessee with SBI, High Court Branch , Allahabad(page 41-78/paper book filed by assessee with tribunal) , wherein there were admittedly cash deposits t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hdrawal from this bank account was Rs. 6,00,000/- during the entire year.So far as cash receipt of Rs. 12,00,000/- allegedly from wife , cash receipt of alleged gift from relatives of Rs. 19,50,00/- as well alleged agricultural income of Rs. 2,00,000 are concerned , the same are accounted for by the assessee by crediting the same to Capital account in the books of accounts, and whatever the expenses incurred in connection with assessee s profession are duly accounted for and set off is already claimed by the assessee against declared professional receipts while computing income chargeable to tax , in the return of income filed with the department. The Balance sheet for 31.03.2011 as well for 31.03.2010 is filed by the assessee in the paper book filed with tribunal(refer page 158-160 and 166-167 of paper book filed by assessee with tribunal) . Perusal of the same reveal, that in this year 2010-11 in the capital account , the assessee has credited Rs.33,19,705/- in the capital account as Additions , which was later explained as alleged gift of Rs. 19,50,000/- in cash from relatives as well Rs. 12,00,000/- as cash allegedly received from wife Mrs. Abha Gautam. The assessee has furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs.65,15,836/- , while at the most the assessee has cash availability of Rs. 6,00,000/- during the year under consideration (being cash withdrawn from the undisclosed bank account) to meet unrecorded/undisclosed expenses to be set off against undisclosed professional receipts and for that too also no details/evidences for such expenses have been submitted by the assessee on which the onus lay.Thus, the ld. CIT(A) was more than reasonable/lenient in allowing 40% of undisclosed professional receipts as deduction towards undisclosed/unrecorded expenses , from undisclosed professional receipts. The assessee has also claimed that some of the expenses were paid in next year such as fee of juniors, although no evidence is brought on record by assessee , while the onus was squarely on the assessee to have brought evidence on record. Thus, in our considered view already an extremely liberal view has been taken by ld. CIT(A) in granting part relief to the assessee as above and no further relief can be granted to the assessee keeping in view the facts and circumstances of the case as there is no availability of funds/cash to meet any further unrecorded expenses, and hence the appeal filed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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