Unexplained investment in jointly purchased property must be tested on presumed equal shares and only the unexplained balance can be added.

In a jointly purchased property, equal ownership was presumed in the absence of any contrary stipulation in the purchase deed, so the assessee's investment had to be examined on the basis of one-half of the total cost, including stamp duty and registration charges. The assessee explained Rs. 22,00,000 out of her share investment of Rs. 22,73,850 through her husband's bank account, leaving only Rs. 73,850 unexplained. The lower authorities erred in sustaining the full addition under section 69 without properly crediting the explained source already accepted. The addition was therefore held unsustainable to the extent made and was deleted.

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Issues: Whether the addition made as unexplained investment under section 69 was sustainable where the property was jointly purchased, the assessee had explained the major portion of her share through her husband's bank account, and only a small balance remained unexplained.

Analysis: The property was jointly purchased by two co-owners, and in the absence of any contrary stipulation in the purchase deed, equal interest was presumed under section 45 of the Transfer of Property Act, 1882. On that basis, the assessee's share in the total investment was to be taken as one-half of the aggregate cost of purchase including stamp duty and registration charges. The assessee had furnished an explanation for Rs. 22,00,000 out of her share investment of Rs. 22,73,850, and the remaining difference was only Rs. 73,850. The lower authorities erred in sustaining the entire addition of Rs. 11,73,850 by treating the whole balance as unexplained, without properly applying the co-ownership principle and the explained source already accepted for the cheque payments.

Conclusion: The addition under section 69 was not sustainable to the extent sustained by the lower authorities, and the balance small amount was not sufficient to justify the impugned addition. The issue was decided in favour of the assessee.

Final Conclusion: The assessment addition on account of unexplained investment was deleted and the appeal was allowed.

Ratio Decidendi: In a jointly acquired property, the assessee's investment must be examined on the basis of the presumed equal share unless the deed shows otherwise, and an addition for unexplained investment cannot be sustained for more than the portion actually remaining unexplained after giving credit for the explained source.

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