No Discharge of Onus to Substantiate Claim of Deduction under Income from Other Sources with Required Documents Evidence: ITAT Restores Matter to AO [Read Order]

claim - income from other sources - documents evidences - ITAT - AO - TAXSCAN

The Income Tax Appellate Tribunal (ITAT), Bangalore restores matter to the file of Assessing Officer (AO), on the ground that there was no discharge of onus to substantiate claim of deduction under income from other sources with required documents evidences.

The assessee, Ganigara Rekha Venugopalan individual had filed the return of income for the assessment year 2017-2018 declaring total income of Rs.46,49,450. The assessment was selected for “limited scrutiny” to examine the claim of deduction u/s 57 of the ITAct. During the course of assessment proceedings, it was noticed that the assessee had declared Rs.45,30,070 as sales proceeds of land under the head “income from other sources”.

The Assessing Officer, however, completed the assessment by taking the cost of land sold at Rs.82.91 per sq.ft. i.e., Rs.72,23,723 / 87,120. The A.O. also did not grant other incidental expenses amounting to Rs.3,41,133. Consequently, the expenditure claimed by the assessee u/s 57 of the IT Act amounting to Rs.49,79,481 was reduced to RS.22,33,252 by the AO.

Aggrieved, the assessee filed an appeal before the first appellate authority. The CIT(A) dismissed the appeal of the assessee. Hence the appeal is preferred before the Tribunal.

A Division Bench consisting of Chandra Poojari, Accountant Member and, George George K, Judicial Member observed that “The assessee has to necessarily prove that shewas only in receipt of total saleable area of 41,947 sq.ft. in exchange of undeveloped land of 87,120 sq.ft. This exercise needs to be done by the assessee before the A.O. Accordingly, the entire issue is restored to the files of the A.O. The assessee shall also produce the necessary evidence to prove that a sum of Rs.3,41,133 are expenses attributable to the sale of developed sites. The assessee shall cooperate with the Revenue and shall not seek unnecessary adjournment in the matter. The A.O. shall afford a reasonable opportunity of hearing to the assessee before a decision is taken in the matter.”

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