2002 (1) TMI 956 - AT - Income Tax

Tribunal quashes tax additions, directs deletion, emphasizing lack of evidence for unexplained expenses.

The Tribunal quashed the additions of Rs. 15,000 for the assessment year 1990-91 and Rs. 25,000 for 1991-92, directing the Assessing Officer to delete ... Unexplained expenditure Issues:- Confirmation of additions made in respect of unexplained household expenses for assessment years 1990-91 and 1991-92.Analysis:The appellant raised several grounds in the appeal, focusing on the confirmation of additions related to unexplained household expenses for the mentioned assessment years. The appellant argued that while additions were made in previous years due to low withdrawals of household expenses, they were not appealed against due to the small amounts involved. However, the appellant contested the additions of Rs. 15,000 and Rs. 25,000 for the respective years as unjustified. The appellant presented detailed written submissions showing withdrawals from the books of account, including substantial agricultural income received from the family's land. The appellant explained that the agricultural income supplemented personal expenses, and the total withdrawals exceeded the estimated household expenses. The appellant emphasized that the reopening of assessment based on subsequent statements during a search was invalid and should not be the basis for estimating household expenses in prior years.The Departmental Representative (DR) supported the decisions of the Departmental Authorities, maintaining the validity of the additions. However, upon reviewing the submissions and documents presented, the Tribunal found that the withdrawals made by the appellant, along with the substantial agricultural income received, adequately covered the household expenses. The Tribunal noted that the burden of proof rested with the Revenue to demonstrate excessive expenditure beyond the withdrawals shown by the appellant and to discredit the explanation regarding the agricultural income. The Tribunal highlighted the lack of additional queries or evidence requested by the Revenue to challenge the appellant's claims. Consequently, the Tribunal concluded that the Revenue failed to provide evidence of unexplained household expenses, leading to the decision to quash the entire amount of additions for the specified assessment years. Therefore, the Tribunal directed the Assessing Officer to delete the additions of Rs. 15,000 for 1990-91 and Rs. 25,000 for 1991-92, ultimately allowing the appeals filed by the appellant.