ITAT partially allows appeal, remands income issue for assessment, upholds disallowance of renovation expenses under sec. 80C.

The ITAT partially allowed the appeal, remanding the undisclosed income issue for further assessment while upholding the disallowance of renovation expenses under sec. 80C.

---

---

Issues:
1. Addition of Rs.12,84,027/- as income from undisclosed sources challenged.
2. Addition of Rs.29,964/- u/s 80C towards house renovation challenged.

Analysis:
1. The first issue involves the addition of Rs.12,84,027/- as income from undisclosed sources. The appellant, a retired SDO, declared income of Rs.1,10,422/- as pension. The Assessing Officer questioned deposits of Rs.28,01,661/- in bank accounts and asked for the source. The appellant claimed it was from retirement benefits, loans, and gifts. However, the AO rejected this, citing lack of evidence and inconsistencies in statements. The CIT(A) deleted Rs.1,13,500/- of the addition, but ITAT remanded the case for further examination of cash withdrawals and deposits for visa purposes.

2. The second issue concerns the addition of Rs.29,964/- u/s 80C for house renovation. The appellant claimed this amount as a deduction, but both the AO and CIT(A) disallowed it. The ITAT upheld the disallowance, stating that sec.80C does not allow deductions for renovation expenses. Therefore, the disallowance was deemed appropriate under the law.

In conclusion, the ITAT partially allowed the appeal for statistical purposes, remanding the undisclosed income issue for further assessment while upholding the disallowance of renovation expenses under sec. 80C.

---