TaxTMI 
TaxTMI 
2016 (5) TMI 486
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....rned Assessing Officer of invoking section 68 of the Income Tax Act, 1961 on the income already offered for taxation and treating the income as deemed income under section 68 of the Income Tax Act, 1961. 3. On the facts and in the circumstances of the case as well as in law the learned Commissioner of Income Tax (Appeals) grossly erred in upholding the action of learned Assessing Officer of treating the income of the assessee as deemed income and not including the same in total income, ignoring / rejecting the facts and law that to charge the income tax, the income has to be included in total income. 4. On the facts and in the circumstances of the case as well as in law the learned Commissioner of Income Tax (Appeals) grossly erred in upholding the action of learned Assessing Officer in not appreciating that in deeming income under section 68, a legal fiction has been created under certain circumstances because they are actually not income but loan / gift etc. whereas under section 56(2)(vi)/(vii) read with section 2(24)(xiv)/(xv), a specific provision exists treating the receipt of sum of money without consideration as income. 5. On the facts and in the ....
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....to be quashed and it is prayed to Your Honours that they please be quashed and / or any other relief just deem fit and proper please be directed. 2. Facts of the case relevant to the disposal of the present appeal are that assessee received cash aggregating to Rs. 4,51,29,000/- on various dates from 10.4.2009 to 07.03.2010 and treated such cash receipts as his 'Miscellaneous Income'. Such miscellaneous income was included in the total income under the head 'income from other sources'. 3. In fact the computation of income offered by the assessee alongwith the return of income is reproduced at page no. 2 of the assessment order as under:- Salary Income 2,10,000/- Remuneration from O.P. Chains Ltd. Property Income 8,400/- Business Income Partner in M/s O.P. Chains (intt) 54,114/- Partner in M/s O.P. Chains (Salary) 75,000/- Prop. M/s Satish Kumar Goyal (Wind power, Jodhpur) (Loss) -35495060/- Income from other sources Interest / mutual fund income, etc 51,961/- Misc. Income 4,51,29,000/- 4,51,80,961/- 4,51,80,961/- 1,00,33,415/- Less Deduction U/s 80C 1,0....
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....as under:- Though several grounds of appeal have been raised but the dispute is in narrow field. The first issue that arises for our consideration is as to whether misc. income of Rs. 4,51,29,000/- offered by the assessee in his computation of income was chargeable as deemed income u/s 68. The provisions of section 68 as were relevant in the year under appeal read as under:- Section- 68 Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year. A plain reading of section 68 and the jurisprudence developed in this regard clearly suggest that if any sum is found credited in the books of an assessee, it is the onus of the assessee to explain about the nature and source thereof and in case such explanation is not satisfactory, such sum may be charged to income tax as income of the assessee. 7. In the present case, it is more than evident that though ass....
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....ns business or profession, nor under the head capital gain. All that remains is the residual head income i.e. income from other sources. Section 56(1) of the Income Tax Act, provides income of every kind, which is not to be excluded from the total income shall be chargeable to income tax under the head income from other sources, if it is not chargeable to income under any of the head specified in section 14 items A to E. Conjoint reading of section 14 and section 56(1) read with section 68 suggests that income referred u/s 68 would be assessable under the head income from other sources. This is so for the reason that all incomes are to be classified under the five given heads and 'nothing otherwise' as contemplated under section 14 has been provided in the Act in respect of the income covered u/s 68 so as to trigger the exception given in section 14. Similarly, the income referred in section 68 does not fall into the exclusions as given in section 56(1) i.e. such deemed income u/s 68 is not to be excluded from the total income under this head nor it is chargeable under the first four heads. Therefore, the natural and obvious result would be that such deemed income u/s 68 would be a....