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| The Tax Publishers2019 TaxPub(DT) 7518 (Mum-Trib) INCOME TAX ACT, 1961
Section 68
Where alleged corpus fund was deposited in bank in the name of assessee and TDS on interest on said fixed deposits were deducted and credited to the PAN of the assessee, the AO was justified in making addition in respect of undisclosed interest income earned by assessee on fixed deposits from corpus fund.
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Income from undisclosed sources - Addition under section 68 - Undisclosed interest on fixed deposits from corpus fund -
AO made addition in respect of undisclosed interest income earned by assessee on fixed deposits from corpus fund. Assessee submitted that the fixed deposits on which interest was earned belonged to co-operative society of residents and it had to hand over the funds to the society as it was holding the same in fiduciary capacity. Therefore, neither fixed deposits nor interest thereon belonged to it and hence, the same would not be taxable in its hands. Held: It was an unrebutted fact that till the end of relevant previous year, the residents' co-operative society had not come into existence, thus, the assessee could not hold any amount in fiduciary capacity of a non-existent entity. Further, the alleged corpus fund was deposited in bank in the name of assessee and TDS on interest on said fixed deposits were deducted and credited to the PAN of the assessee. Therefore, the AO was justified in making addition in respect of undisclosed interest income earned by assessee on fixed deposits from corpus fund.
Distinguished:Asstt. CIT, Central Circle-7, Mumbai v. M/s. Evershine Builders (P) Ltd. ITA No. 2827/Mum/2008 decided on 1-2-2010
REFERRED :
FAVOUR : Against the assessee
A.Y. : 2011-12
INCOME TAX ACT, 1961
Section 80IB(10)
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