SMT. MADHU VIJAY,KOTA vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOTA

“ 1. That the ld. A.O. grossly erred on law to assess the income u/s 153C in case of Appellant and carried the assessment u/s 153C/143(3) of the Income Tax Act. That the ld.CIT (A) also erred in sustaining the said order.

2. That the ld. AO grossly erred on law and facts in making the addition of FDR interest income Rs. 64,844/-. That the ld. CIT (A) also erred in sustaining the said order.

3. That the ld. AO grossly erred on law and facts in making addition of Post Office interest Rs. 14,400/- & SB A/c in Trust Rs. 1200/- & The ld. CIT (A) also erred in sustaining the said order.

4. The assessee craves to leave, add, alter amend the grounds of appeal at the time of hearing.”

Ground No. 1 is regarding validity of assessment framed under section 153C read with section 143(3).

Ground No. 2 is regarding addition on FDR interest.

There is no incriminating material found which belong to the assessee disclosing the income on account of interest on FDR. Therefore, when no reference is made by the AO of any document found during the course of search and seizure action carried out in the case of Kota Dal Mill under which the husband of the assessee was covered, the addition made by the AO while framing the assessment under section 153C is not justified. Accordingly the said addition is deleted. Even otherwise, the interest on FDR in case of Individual may be considered either on receipt basis or on accrual basis, if assessee is following a practice of recognizing the income on receipt basis then no addition can be made on this account and that too in the proceedings under section 153C of the Act.

Ground No. 3 is regarding interest on Post Office and Savings Bank account.

Hence in the absence of any material, the addition made by the AO is not sustainable.

For the assessment years 2012-13, the assessee has raised the following grounds :-

“ 1. That the ld. AO grossly erred on law and facts in issuing the notice u/s 153C in case of Appellant and carried the assessment u/s 153C/143(3) of the Income Tax Act. That the ld. CIT(A) also erred in sustaining the said order.

2. That the ld. AO grossly erred on law and facts in charging tax on FDR interest Rs. 52,208/-. That the ld. CIT (A) also erred in sustaining the said order.

3. The assessee craves to leave, add, alter amend the grounds of appeal at the time of hearing.”

5. At the time of hearing, the ld. A/R of the assessee has stated that the assessee does not press ground no. 1 of the appeal and the may be dismissed as not pressed. The ld. D/R has raised no objection if the ground no. 1 of the assessee’s appeal is dismissed as not pressed. Accordingly, ground no. 1 of the assessee’s appeal is dismissed being not pressed.

Ground No. 2 is regarding interest on FDR.

For the assessment years 2013-14, the assessee has raised the following grounds :-

“1. That the ld. AO grossly erred on law and facts in issuing the notice u/s 153C in case of Appellant and carried the assessment u/s 153C/143(3) of the Income Tax Act and the ld. CIT(A) also erred in sustaining the findings of ld. AO.

2. That the ld. AO grossly erred on law and facts in making the addition of FDR interest income Rs. 47,746/-. That the ld. CIT (A) also erred in sustaining the said addition made ld. AO.

3. That the ld. AO grossly in stating the tuition income as unexplained u/s 68 and levied tax u/s 115BBE. This is wrong, there should be the regular tax only on the income declared earlier and which not a part of search.

4. The assessee craves to leave, add, alter amend the grounds of appeal at the time of hearing.”

Ground Nos. 1 & 3 not pressed.

Ground No. 2 is against interest on FDR

Order is pronounced in the open court on 04/10/2019.