TaxTMI 
TaxTMI 
2018 (11) TMI 541
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....the course of search, the undisclosed income of the assessee was filed as follows:- (i) Unaccounted cash found at the residence on the date of search i.e. on 24/10/2010 . Rs.14,46,855/- (ii) Unaccounted cash found at the residence during the operation of restrictive order u/s 132(3) of the act on 22/02/2011. Rs. 3,00,000/- (iii) Undisclosed cash found at assessee's chamber at M/s. R.K. Children's Hospital during the operation of restrictive order u/s 132(3) of the act on 22/02/2011. Rs. 2,29,100/- Rs.19,75,955/- (iv) Unexplained investment in gold jewellery weighing 2000gms Rs.37,30,000/- (v) Suppressed receipts from profession as per the seized material Rs. 8,16,550 (vi) Assessee's share of doctors fees received towards in-patient consultancy, not reflected in the books of M/s. R.K. Children's Hospital & Perinatal Centre Rs.21,89,650/- Total Rs.87,12,155/- The Assessing Officer after considering the explanation of the assessee, completed the assessment u/s. 143(3) of the Act. 3. The facts relating to addition of Rs. 9,70,000/-, the Assessing Of....
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....at at the time of recording the statements on 24. 12.2012, I had explained the investigating officer that out of Rs. 14,46,855/- cash found at my residence, an amount of Rs. 9,70,000/- representing the consultation from patients of 2009-10 financial year which was offered by me in the return filed under section 153A for A.Y.2010-11 offering an additional income of Rs. 18,54,731/-. (c) Since, the said amount of receipts of Rs. 18,54,371/- has already been included in the income of earlier year the same cannot be included again for the year under consideration as unexplained cash balance. (d) The investigation wing has thoroughly searched my residential premises, professional premises and also the lockers and finally traced out the said cash balance. Hence, the reflection of the cash available with me after meeting certain expenditure like acquisition of the jewellery." 5. The A.O. has considered the explanation given by the assessee. During the course of search he has observed that the contention on the issue of unaccounted cash found during the course of search of Rs. 19,75,955/- (Rs.14,46,815/- + Rs. 3,00,000 + Rs. 2,29,100/-) is not acceptable on the ground t....
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....te to the assessee's wife. I find that the AO has rightly rejected this contention. However, I find merit in the assessee's claim for telescoping of an amount of Rs. 9,70,000/- towards cash found during search with reference to the additional professional receipts offered of Rs. 18,54,871/- for A.Y.2010-11, as there is nothing on record to indicate that the additional income offered has been utilized for any other investment or expenditure. In such factual circumstances, I am of the view that the assessee's claim for telescoping is justified. Therefore, the AO is directed to allow the benefit of telescoping to the tune of Rs. 9,70,000/- for the cash found during the search operation." 6. The Ld. D.R. has submitted that there is no evidence that the amount of Rs. 9,70,000/- pertains to earlier years, therefore, the Ld. CIT(A) is not correct giving telescoping benefit to the assessee. 7. On the other hand, the Ld. Counsel for the assessee relied on the order of the A.O. 8. We have heard both the parties, perused the materials available on record and gone through the orders of the authorities below. There is a search conducted in the case of the assessee.....
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....19,75,955/-. We find that the Ld. CIT(A) gave a categorical finding that the cash found during the course of search represents part of such professional receipts have been accounted by the assessee and filed the return of income. This fact is not disputed by the A.O. as found by the CIT(A). Once a part of income is already disclosed in the return of income, no separate addition can be made. Therefore, we find no infirmity in the order passed by the CIT(A) and this ground of appeal raised by the revenue is dismissed. 10. Ground No.4 relating to unexplained investment in gold jewellery. In the assessment order, the A.O. has noted that during the course of search, the jewellery weighted 3040 gms. (net wt.) was found in the locker in the ING Vysya Bank and jewellery weighing 544.30 gms. was found in the residence. After considering the assessee's claim towards allowance for family members, gold jewllery weighing 2000 gms. was considered unexplained and seized. The value of the jewellery seized was taken at Rs. 37,30,000/-. The A.O. has asked the assessee to explain how the amount of Rs. 37,30,000/- cannot be treated as unexplained income. The assessee has explained before t....
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....made by the assessee for allowance in the hands of family members. The rejection of additional claim of allowance for 200 gms jewellery is justified. However, I find merit in the assessee's request for telescoping of an amount of Rs. 8,84,371/- with reference to additional income offered for A.Y.2010-11 and an amount of Rs. 3,91,675/- with reference to addition made towards undisclosed income for A.Y.2010-11. There is no reference to any material to indicate that the above amount were utilized for any other investment or expenditure. Hence the AO is directed to give the benefit of telescoping for an amount of Rs. 8,84,371/- with reference to the additional income offered and Rs. 3,vith reference to the additions made in A.Y.2010-11,) Thus this ground is partly allowed." 12. On appeal before us, the ld. D.R. has submitted that there is no evidence that an amount of Rs. 8,84,371/- pertains to earlier years and also there is no evidence in respect of Rs. 3,91,675/- and the Ld. CIT(A) simply deleted the addition made by the A.O. without any evidence and strongly supported the order passed by the A.O. 13. On the other hand, the Ld. Counsel for the assessee relied on the order ....
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.... Accordingly, this ground of appeal filed by the revenue is dismissed. 16. Ground No.5 is relating to addition towards unaccounted outpatient receipts of Rs. 18,16,550/-. During the course of search, it was noticed that the assessee had earned out-patient professional receipts of Rs. 23,16,530/- as per the seized material. The receipts are earned from the period 1.4.2010 to 24.10.2010. The A.O. has noted that the assessee only paid advance tax of Rs. 2 lakhs taking into account an amount of advance tax paid. The A.O. was of the view that the assessee had intended to disclose only Rs. 15 lakhs as a professional receipt for this period but for the search operation, the assessee would not have declared additional income would have suppressed balance receipts. Hence, A.O. felt that the assessee's intention to suppress income from profession by an amount of Rs. 8,16,550/- {Rs. 53,16,550- (-) Rs. 15,00,000/-} is clearly evident from the advance tax paid, therefore, the A.O. made the impugned addition of Rs. 8,16,550/-. Before the CIT(A), it was submitted by the assessee that the amount of Rs. 23,16,550/- seized during the course of search pertains to current year and therefore, it can....
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....the same. This ground of appeal is allowed." 17. On appeal, the Ld. D.R. relied on the order passed by the A.O. 18. On the other hand, the Ld. Counsel for the assessee relied on the order passed by the CIT(A). 19. We have heard both the parties, perused the materials available on record and gone through the orders of the authorities below. In this case, during the course of search, the A.O. has found that an amount of Rs. 23,16,530/- relates to out-patient professional receipts from 1.4.2010 to 24.10.2010. When the A.O. has asked the assessee, it is submitted before the A.O. that these receipts pertaining to current year and the same will be offered for taxation. The A.O. has not accepted the explanation given by the assessee on the ground that the assessee has only paid advance tax of Rs. 2 lakhs, therefore, the assessee will offer the professional receipts for taxation only Rs. 15 lakhs and he is of the opinion that the balance of {Rs. 23,16,550 (-) 15 lakhs = Rs.8,16,550/-} is treated as undisclosed income. When the assessee himself accepted that he will file a return of income and same will be considered for the taxation, the A.O. without considering the explanation gi....
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....count, as the assessee had not maintained books of account. But it is seen that these receipts are part of regular income admitted by the assessee in the return of income filed for this year and a copy of the ledger extract admitting these receipts as part of professional receipts were filed. The reasoning for the addition as seen from the assessment order appears to be that as the receipts were not recorded in the regular books of account of the hospital, or the appellant it would amount to unaccounted income of the assessee and should be added to the total income. I am of the view that such a reasoning is not in accordance with law. Admittedly these amounts are part of professional receipts relating to the current year. Though these receipts were not recorded in the regular books of account of the hospital or of the assessee, they have been included and considered as part of current year receipts while filing the return of income. These receipts being part of current year professional receipts, the time for declaring them in the return of income had not lapsed. Subsequent to the search the assessee had compiled these receipts in his books of account and offered ....