IN INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & SHRI WASEEM AHMED, ACCOUNTANT MEMBER I.T.A. Nos.124/Rjt/2016 (Assessment Year : 2011-12) Kantilal B Solanki, I.T.O, 8-Chitrkut Society, Vs . Ward-(1)2, Nr. Nobal School, Junagadh. Junagadh PAN/GIR No. BPZPS8321D (Appellant) (Respondent)Appellant by Written Submission Respondent by Shri Anil Kumar, Sr. D.R Date o f He ring 19/09/2019 /Da te o f Pro no unc ement 20/09/2019 ORDER PER WASEEM AHMED ACCOUNTANT MEMBER: captioned appeal has been filed at instance of Assessee against order of Learned Commissioner of Income Tax (Appeals)- 3, Ahmedabad [Ld. CIT(A) in short] dated 01/03/2016, arising in matter of assessment order passed under s. 144 of Income Tax Act, 1961 (hereinafter referred to as "the Act") dated 03/02/2014 relevant to Assessment Years (A.Y.) 2011-12. assessee has raised following grounds of appeal: ITA No.124/RJT/2016 A.Y.s 2011-12 -2- 1. Ld. CIT(A) has erred in law as well as on facts in confirming assessment order passed U/s. 144 of act. order deserves annulment. 2. Ld. CIT(A) has erred in law as well as on facts in not considering that no reasonable opportunity was provided to appellant by Ld. A.O. order deserves annulment. 3. Ld. CIT(A) has erred in law as well as on facts in confirming passing of order U/s. 144 without properly service of notice on appellant. proceedings being bad in law deserve annulment. 4. Ld. CIT(A) has erred in law as well as on facts in not considering that Ld. A.O. has not provided material available with him and utilized against assessee. assessment thus made is in violation of principles of natural justice and deserves annulment following guidelines issued by Hon. Supreme Court in 249 ITR 216 (SC). 5. Ld. CIT(A) erred in not considering that there was error by Ld. A.O. in not giving any notice against propose determination of total income as made by him and thereby violated principals of natural justice. 6. Ld. ClT(A) has erred in not considering that by not giving any notice against propose determination of total income as confirmed by him was without providing opportunity to assessee for invocation provisions of section 144A and depriving assessee to have benefit of valuable guidance of Joint CIT Sir, though statutorily provided. 7. assessment order passed being bad in law ought to have been annulled. 8. Ld. CIT(A) has erred in law as well as on facts in confirming addition of Rs. 6,72,473/- (as per A.O. para 3 Rs. 5,19,863/-). same needs deletion. 9. Ld. CIT(A) has erred in law as well as on facts in confirming addition Rs. 6,72,473/- (as per A.O. para 3 Rs. 5,19,863/-) based on irrelevant material. same needs deletion. 10. Ld. CIT(A) has erred in law as well as on facts in not considering expenses, deductions and exemptions available to appellant under various provisions of Act. ITA No.124/RJT/2016 A.Y.s 2011-12 -3- 1l. Without prejudice, Ld. CIT(A) has erred in law as well as on facts in not applying guidelines available U/s. 44AD. taxability of gross income in full is neither legal nor statutory nor logical. 12. Without prejudice, income determined needs suitable reduction. 13. Without prejudice Ld. CIT(A) erred confirming disallowance of expenditure at 100%. same needs suitable reduction. 14. Without prejudice Ld. CIT(A) erred in not considering identical cases to compare his own action. assessment needs annulment. 15. appellant craves leave to add/alter/amend and/or grounds of appeal before actual hearing takes place. assessee has raised as many as 15 grounds of appeal but effective issue is that learned CIT-A erred in confirming disallowance made by AO in part for 5,19,863.00 on account of non-furnishing of supporting vouchers. 2. Briefly stated facts are that assessee in present case is individual and has declared income under head income from other sources amounting to 1,52,620 only. As such assessee has shown gross income from other sources amounting to 6,72,483 and claimed deduction of 5,19,863 against such income. AO during assessment proceedings requires assessee to justify claim made for 5,19,863 against income from other sources. But assessee failed to make any representation. Accordingly, AO disallowed entire gross income of 6,72,483 and added to total income of assessee. Aggrieved assessee preferred appeal to learned CIT (A). ITA No.124/RJT/2016 A.Y.s 2011-12 -4- 3. assessee before learned CIT (A) submitted that AO has made double addition to extent of income of 1,52,620 as same was already disclosed in income tax return. 4. assessee further submitted that income cannot be earned without incurring expenses. Therefore AO erred in making disallowance of hundred percent expenses claimed by assessee. assessee to buttress his argument referred to various judgments. 5. However, learned CIT (A) disregarded contention of assessee by observing that income was offered to tax under head income from other sources and therefore onus lies on assessee to justify expenses claimed against such income based on documentary evidence. But assessee failed to provide any documentary evidence in support of expenses of 5,19,863.00. Accordingly, learned CIT (A) rejected claim of assessee. However learned CIT (A) was pleased to delete addition made by AO to extent of income offered by assessee for 1,52,620.00 by observing that impugned addition is leading to double addition. Thus, learned CIT (A) confirmed order of AO in part. Being aggrieved by order of learned CIT (A) assessee is in appeal before us. ITA No.124/RJT/2016 A.Y.s 2011-12 -5- 6. learned AR before us filed written submissions stating that entire amount of expenditure claimed against income from other sources cannot be disallowed. As per learned AR, income cannot be generated without incurring expenses. Accordingly learned AR before us claimed to calculate income on estimate basis. 7. On other hand learned DR vehemently supported order of authorities below. 8. We have heard learned DR and perused materials available on record. assessee in instant case has shown gross income of 6,72,483 and claimed expense of 5,19,860 against such gross income leaving balance of 1,52,620 under head income from other sources. authorities below made disallowance of all expenses claimed by assessee against gross income of 6,72,483 in absence of any documentary evidence. 8.1 From preceding discussion, we note that primary onus lies on assessee to justify nature of income shown under head other sources but assessee has failed to clarify same. Similarly, assessee has not specified nature of expenses against such gross income based on any cogent material. 8.2 Generally, income cannot generated without incurring expenses qua to income. But it does not apply to each and every kind of income. For example, in case assessee has invested his own fund in bank account and earning interest income thereon. Then, there cannot ITA No.124/RJT/2016 A.Y.s 2011-12 -6- be any claim of expenses against such income. Yet, if assessee claims any expense against such income, then onus lies on assessee to justify such expenses based on documentary evidence. 8.3 provisions of section 57 of Act requires that expenditure against income from other sources will be deducted provided it is not in nature of capital expenditure and laid out or expended wholly and exclusively for purpose of making or earning such income. Thus, it is duty of assessee to justify that deduction claimed by him was incurred in connection with impugned gross income. But assessee, failed to do so. Therefore, we do not find any reason to interfere in finding of authorities below. Hence ground of appeal of assessee is dismissed. 9. In result, appeal of assessee is dismissed. This Order pronounced in Open Court on 20/09/2019 -Sd- -Sd- (RAJPAL YADAV) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER (True Copy) Dated 20/09/2019 manish Kantilal B Solanki v. I.T.O, Ward-(1)2, Junagadh