Veena Mishra Through Nitish Mishra Vs ACIT (ITAT Patna)
No Blind Clubbing with Husband’s Case! ITAT Upholds Wife’s Independent Income- Substantive Taxability in Assessee’s Hands – Protective Assessment Quashed
Facts of the Case
Assessee filed return on 30.03.2004 declaring- Income from other sources: ₹75,513/- (mainly interest) & Agricultural income: ₹80,968/-. AO reopened assessment u/s 147 & completed reassessment u/s 143(3) r.w.s. 147 on 31.01.2006. AO accepted agricultural income & treated ₹75,320/- as protective addition in Assessee’s hands,
Substantively taxed same amount in hands of husband, late Dr. Jagannath Mishra (ex-CM of Bihar) on the assumption that Assessee, being a housewife, had no independent source of income. CIT(A) upheld AO’s action vide order dated 31.01.2025.
Grounds Before Tribunal
- Assessee had independent income & assets in her own right, accepted in past assessments.
- Wealth-tax returns & earlier IT orders showed ownership of 4.72 acres of agricultural land & other properties.
- Long-term capital gain claimed exempt u/s 54 in earlier year was accepted.
- Protective assessment was unjustified when substantive addition already made in husband’s case.
- CIT(A) ignored earlier ITAT rulings (Nov 2024, AYs 2000-2002) in Assessee’s own cases where protective additions were held invalid.
Tribunal’s Observations
- Earlier records clearly showed Assessee had independent source of income & assets.
- AO’s presumption that she was merely a housewife & income belonged to husband was without evidence.
- Once substantive addition already made in husband’s case, there was no justification to continue protective addition in Assessee’s case.
- Following ITAT’s own coordinate bench orders in earlier years, income must be assessed substantively in Assessee’s hands.
Decision
- Protective assessment quashed.
- Income of ₹75,320/- to be substantively assessed in Assessee’s own hands.
- Other grounds not separately adjudicated since relief already granted.
- Appeal allowed in favour of Assessee.
Key Takeaways
- Protective assessments in spouse’s hands are unsustainable where evidence of independent income/assets exists.
- Past returns, wealth-tax assessments & agricultural holdings are sufficient proof of independent income.
- Mere reference to spouse’s political background or allegations cannot shift taxability without cogent evidence.
FULL TEXT OF THE ORDER OF ITAT PATNA
