1979 (5) TMI 38

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.... asst. yrs. 1972-73, 1973-74, 1974-75 and 1975-76 ended on31st March, 1972,31st March, 1973,31st March, 1974and31st March, 1975respectively. The return of income for the asst. yr. 1972-73 was filed on31st July, 1972declaring income at Rs. 10,600. The assessee did not disclose any income from Shakahari Hotel because right from the asst. yr. 1961-62 the income from this Hotel was being shown by Smt. Padmavati Jain and the licence for the hotel also stood in her name. The hotel was registered on19th Feb., 1962in the name of Smt. Padmavati Jain under Delhi Shops & Establishments Act, 1954. Though a separate assessment dt.22nd Nov., 1974had already been made on Smt. Padmavati Jain determining the hotel income at Rs. 14,000 the ITO required the a....

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....ted out that in view of this agreement the sum of Rs. 10,000 was shown as an amount due in his wealth-tax returns. It was also explained that the lady was carrying on business by hiring the services of one Mr. Rao who had his own hotel inRangoonand had vast experience in this line. After the retirement of Mr. Rao her persons were employed for hotel business. In the letter dt.11th March, 1975it was explained that the lady was the real owner of the hotel and for the last several years he had been declaring only rental income from the hotel and was taxed on such rental income. The ITO did not accept the assessee's submissions. There were four circumstances on the basis of which he held that the income from the hotel really belonged to the asse....

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....e the AAC the assessee relied on the Tribunal's order in ITA Nos. 3550 to 3554 of 1974-75 dt.24th March, 1975pertaining to the asst. yrs. 1967-68 to 1971-72 in the case of Smt. Padmavati Jain for the submission that the income taxed in the hands of Smt. Padmavati Jain should not be taxed in the hands of the assessee. The AAC did not accept this submission because the point whether the business income of the hotel belonged to Smt. Padmavati Jain or to the assessee, was not in dispute before the Tribunal. The AAC examined all the four circumstances on the basis of which the ITO had held that the income from the hotel belonged to the assessee and came to the conclusion that these circumstances were not enough to hold that the income from the h....

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.... the lady is the owner of the business of Shakahari Hotel and if this real state of affairs is doubted by the Revenue, the onus has to be discharged by the Revenue. For discharging this onus the ld. Deptl. Rep. relied on the same four circumstances which have been mentioned by the ITO. The first circumstance mentioned is that the hotel premises belong to the assessee. This fact is admitted but there is no legal impediment in a married lady taking the premises on rent from her husband and in carrying on separate business. The second business. The second circumstance is that the assessee advanced a sum of Rs. 10,000 in the initial stages for carrying out structural alterations. The assessee has actually treated this amount as advance to his w....