INCOME TAX ACT, 1961

Section 69B

Income from undisclosed sources - Addition under section 69B - Undisclosed investment in real estate -

Search and seizure operation was conducted at premises of broker dealing in property. Certain documents seized showed that assessee-dealer cum broker received certain sum in cash for two land deals with two companies. Assessee contended that he received a certain sum from those deals but made cash payment to farmers for acquiring land. Assessee claimed for set-off of unaccounted cash payments against unaccounted cash receipts for computing investment in accordance with section 69B. AO alleged that assessee did not submit confirmation from farmers in support of said cash payments and accordingly, denied claim for set-off and made addition in terms of section 69B. Held: Tribunal allowed claim of assessee holding that subsequent payment should be presumed to be made out of cash available from earlier receipts. It was found that assessee did not furnish any detail or particular about availability of funds from unaccounted land deals during course of assessment proceedings and said receipt were protectively taxed in hands of assessee. Substantive addition was already made in hands of companies and, thus, such funds were prima facie not available for any further investment made by assessee in his individual land business. Since there was no co-relation between unexplained cash receipts and unexplained cash payments, AO rightly denied claim of assessee.

REFERRED :

FAVOUR : Against the assessee

A.Y. : 1-4-1085 to 21-9-1995

INCOME TAX ACT, 1961

Section 69B

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