Case Law Details
Sumit Tayal Vs ITO (ITAT Pune)
Admittedly, the assessee filed revised return on 31-07-2016 showing share in partnership firm M/s. Nirman Reality at Rs.49,97,480/-. The accounts of the partnership firm were actually finalised later on 24-092016 and the assessee’s share was determined at Rs.45,85,406/-. This change in the share in the profit of the partnership firm took place, inter alia, with the corresponding increase in the assessee’s salary originally from the firm at Rs.3.00 lakh which was raised to Rs.5.00 lakh. In the original return, salary income from the firm was shown at Rs.3.00 lakh with the profit from the firm at Rs.49.97 lakh. However, while filing the revised return, the assessee increased his taxable income by the additional salary of Rs.2.00 lakh but omitted to give effect to the figure of exempt share in the partnership firm which actually got reduced to Rs.45,85,406/- from the original share declared in the return at Rs.49,97,480/-. All the necessary relevant financial statements of the partnership firm have been placed on record which indicate the assessee’s share in the profit at Rs.45,85,406/-. Merely because of a mistake in not lowering the share in profit of the firm from Rs.49,97,480/- to Rs.45,85,406/-, cannot lead to the treatment of the differential amount as ‘Income from other sources’ when all the necessary details and facts show that the assessee’s share in the profit was at Rs.45,85,406/- at the time of finalisation of the accounts of the firm, which was originally at the time of filing of the assessee’s return at Rs.49,97,480/-. Under these circumstances, we are satisfied that there is no reason to treat the difference in the share of profit of the firm as ‘Income from other sources’. The addition is directed to be deleted.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal by the assessee arises out of the order dated 03-06-2019 passed by the CIT(A)-3, Pune in relation to the assessment year 2016-17.
2. The only issue raised in this appeal is against the confirmation of addition of Rs.4,12,074/-.
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