TaxTMI 
TaxTMI 
2026 (8) TMI 1238
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.... multiple grounds numbered 1 to 6, which we, for the sake of brevity are not inclined to reproduce here. 3. The brief facts of the case are that the assessee, an individual, is engaged in the business of earning commission and consultancy income and deriving income from letting out house property. For the assessment year under consideration, the assessee filed the return of income declaring a total income of Rs. 3,87,620/- which comprises of Income from house property of Rs. 1,42,847/-, Commission Income & Consultancy receipts declared as professional income u/s. 44ADA of the Act to the tune of Rs. 3,71,500 (being 50% of gross receipts of Rs. 7,43,000/-). The gross total income of the assessee worked out to Rs. 5,14,347/- and assessee cl....
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....t commission income to be brought to tax under the presumptive scheme. The Assessing Officer accordingly proceeded to assess the commission receipts of Rs. 4,55,000 under the head "Income from Other Sources" under section 56 of the Act. 4. Aggrieved by the order of the AO, the assessee preferred an appeal before the Ld. CIT(A) who held that the commission income earned by the assessee is out of scope of section 44ADA of the Act. 5. Aggrieved by the order of Ld. CIT(A), the assessee preferred an appeal before us. 6. The Ld. AR before us submitted that the Ld. CIT(A) erred in treating commission income of Rs. 4,55,000 as "Income from Other Sources", even though the said amount already formed part of the gross receipts of Rs. 7,43,000....
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....es. It was emphasized that deductions under section 57 are allowable only on actual expenditure laid out wholly and exclusively for earning such income, which the assessee failed to prove. Accordingly, the Ld. DR prayed that the order of the Ld. CIT(A) be upheld, and the appeal of the assessee be dismissed. 8. We have carefully considered the rival submissions and perused the materials available on record. The limited issue before us is regarding two things as follows: (i) Whether the commission income can be offered to tax under presumptive scheme of section 44ADA; and (ii) Whether the gift received from relative is taxable 8.1 It is an admitted position that the assessee deposited cash during the year was explained....
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....re the assessee claims that his income from profession is less than 50% of the gross receipts, he is required to maintain books of account and get them audited under section 44AB of the Act. It is also noticed that in practice the professional receipts may be applied for business purposes, personal use or capital accretion and, therefore, the presumption of 50% income cannot mechanically apply in every case and must be examined in the light of the facts on record. 8.4 Applying the above statutory framework to the facts before us, we find that the assessee has not demonstrated whether he was carrying on any profession specified in section 44AA(1) or not. The activity carried on by the assessee is earning commission income, which, by itsel....