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“income from other sources”

Income HeadsSection 56Section 568,248 judgments

The decision most relied on for income from other sources is Jute Corporation of India Ltd. v. CIT (187 ITR 688), cited in 1,372 judgments on BharatTax.

Leading authorities on income from other sources

Jute Corporation of India Ltd. v. CIT
187 ITR 688 · 1991 · Supreme Court
1,372
citing judgments

The Commissioner of Income Tax (Appeals) possesses co-terminus powers with the Assessing Officer and can direct the Assessing Officer to perform actions he failed to do, but cannot introduce a new source of income in the assessment. The appellate assessment must be confined to the items of income that were the subject matter of the original assessment.

Totgars Co-operative Sale Society Ltd. v. ITO
322 ITR 283 · 2010 · Supreme Court
1,283
citing judgments

The interest income earned by a cooperative society from investing its surplus funds in fixed deposits with banks is not "derived from" its eligible business activities and is taxable as "income from other sources" under Section 56, thus not qualifying for deduction under Section 80P.

K.P. Varghese v. ITO
131 ITR 597 · 1981 · Supreme Court
989
citing judgments

An addition to income cannot be made merely on the basis of a difference in valuation of assets or a Valuation Officer's report without establishing actual understatement of consideration or the source of unexplained funds through proper enquiry. The Assessing Officer must conduct proper enquiry and satisfy the conditions for making such additions.

GE India Technology Centre Pvt. Ltd. v. CIT
327 ITR 456 · 2010 · Supreme Court
663
citing judgments

Tax must be deducted at source from payments made to a non-resident under Section 195 only if such payment is chargeable to tax in India. The Assessing Officer bears the onus to establish that the payments made are indeed chargeable to tax under the Income Tax Act.

Commissioner of Income Tax v. Nova Promoters and Finlease (P) Ltd.
342 ITR 169 · 2012 · High Court
658
citing judgments

To make an addition under Section 68 for unexplained cash credits, the Assessing Officer must conduct proper inquiry into the identity, genuineness, and creditworthiness of the creditor, especially concerning share application money. The assessee's initial discharge of burden by providing necessary details shifts the onus back to the AO for further investigation, including the source of source.

Tuticorin Alkali Chemicals & Fertilizers Ltd. v. CIT
227 ITR 172 · 1997 · Supreme Court
621
citing judgments

Interest income earned on deposits, particularly before the commencement of business operations or as a requirement for business licensing, is taxable as "income from other sources" under Section 56, and cannot be treated as business income or set off against interest on borrowed funds.

Kale Khan Mohammad Hanif v. CIT
50 ITR 1 · 1963 · Supreme Court
581
citing judgments

The assessee bears the onus of proving the source and nature of any sum of money or receipt found to have been received by them. If the assessee fails to satisfactorily explain the receipt, the Income-tax Officer is entitled to treat it as taxable income.

Liberty India v. CIT
317 ITR 218 · 2009 · Supreme Court
571
citing judgments

The Supreme Court clarified that for profits and gains to be eligible for deductions under sections like 10B, 80IA, or 80IB, the income must be "derived from" or have a direct nexus to the eligible business activity. Income from incidental sources like the sale of scrips/licenses or interest on employee loans is generally not considered as derived from the eligible business for such deductions.

Judgments citing income from other sources

Sarvodaya Credit Co Op Society Ltd Barkur, Udupi vs. Income-Tax Officer, Ward-1, Udupi

In the result, the appeal filed by the assessee is allowed

ITA 746/BANG/2024[2017-18]Status: DisposedITAT Bangalore25 Jun 2024AY 2017-18

Bench: Shri Chandra Poojari & Shri Prakash Chand Yadavsarvodaya Credit Co-Op. The Income Tax Officer Society Ltd. Ward -2, Udupi Car Street, Barkur Vs. Udupi 576210 Pan – Aaeas9576Q (Appellant) (Respondent) Assessee By: Smt. Sheetal Borkar, Advocate Revenue By: Ms. Neha Sahay, Jcit-Dr Date Of Hearing: 25.06.2024 Date Of Pronouncement: 25.06.2024 O R D E R Per: Prakash Chand Yadav, J.M. This Appeal Filed By The Assessee Challenges The Din & Order No. Itba/Nfac/S/2003-24/1061360577(1) Of The National Faceless Appeal Centre, Delhi (Cit(A)) Dated 22.02.2024 Passed Under Section 250 Of The Income Tax Act, 1961 (The Act) In Respect Of Assessment Year (Ay) 2017-18. 2. The Brief Facts Of The Case Are That The Assessee Society Filed Its Return Of Income(Roi) On 06.11.2017 Declaring Gross Total Income Of Rs.18,34,325/- & Net Income As Nil. Roi Filed By Assessee Was Selected For Scrutiny, After Issuing Statutory Notices. During The Course Of Assessment Proceedings The Ld. Assessing Officer (Ao) Treated Certain Income Of The Assessee As Income From Other Sources(Ios) & Without Giving The Benefit Of The Expenses Attributable Ios Assessed The Entire Income Under The Head ‘Income From Other Sources’. The Ao Further Added Rs. 1,90,000/- On Account Of The Provisions Made By Assessee With 2 Sarvodaya Credit Co-Op. Society Ltd. Respect To Employee’S Retirement Fund & Provision With Respect To Nps Fund Amounting To Rs.27,57,696/-.

For Appellant: Smt. Sheetal Borkar, AdvocateFor Respondent: Ms. Neha Sahay, JCIT-DR
Section 250Section 57Section 80PSection 80P(2)(a)

scrutiny, after issuing statutory notices. During the course of assessment proceedings the ld. Assessing Officer (AO) treated certain income of the assessee as income from other sources(IOS) and without giving the benefit of the expenses attributable IOS assessed the entire income under the head ‘income from other sources ... Additional grounds raised by assessee are as under:- a. The Ld CIT(A) failed to appreciate that if interest/dividend income is treated as Income from other sources then expenditure under section 57 should be allowed as per the judicial High Court. b. The Ld CIT(A) failed to appreciate that

P.Srinivasan, Salem vs. ITO, Ward 1(1), Hosur

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 870/CHNY/2024[2017-18]Status: DisposedITAT Chennai24 Jun 2024AY 2017-18

Bench: Shri Mahavir Singhand Shri Manoj Kumar Aggarwalआयकर अपील सं./Ita No.: 870/Chny/2024 िनधा"रण वष"/Assessment Year: 2017-18 Shri Ponnusamy Srinivasan, The Income Tax Officer, No.51/19, Venugopalasamy Street, Vs. Ward 1(1), Hosur – 635 109. Hosur. Pan: Gcyps 1607B (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/Appellant By : Shri T.S. Subramaniam, Fca ""यथ" क" ओर से/Respondent By : Shri Ar.V. Sreenivasan, Addl.Cit सुनवाई क" तारीख/Date Of Hearing : 24.06.2024 घोषणा क" तारीख/Date Of Pronouncement : 24.06.2024 आदेश /O R D E R Per Mahavir Singh: This Appeal By The Assessee Is Arising Out Of The Order Of The Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi In Order No.Itba/Nfac/S/250/2023- 24/1060347000 (1) Dated 30.01.2024. The Assessment Was Framed By The Income Tax Officer, Ward 1, Hosur For The Assessment Year 2017-18 U/S.144 Of The Income Tax Act, 1961 (Hereinafter The ‘Act’) Vide Order Dated 29.12.2019. 2. At The Outset, The Ld.Ar For The Assessee Stated That The Order Of Cit(A) Is Ex-Parte & There Is No Adjudication By Cit(A)-Nfac On Merits Of The Case. It Was Stated By Ld.Ar That Even On Jurisdictional Ground On New Issue Of 143(2) Of The Act, The Cit(A)-Nfac Has Not Properly Adjudicated The Issue. On Merits, The Issue Is Addition Made By The Ao Of Unexplained Cash Deposit Added U/S.69A Of The Act & Taxed U/S.115Bbe Of The Act Amounting To Rs.31,13,500/- & Assessing ‘Income From Other Sources’ At Rs.22,97,140/-. The Ld.Ar Stated That The Cit(A)-Nfac Has Given His Adjudication As Under:- 6. Ground No. 6: This Ground Pertains To Legality Of Assessment U/S 144 Without Issuance Of Notice U/S 143(2).

For Appellant: Shri T.S. Subramaniam, FCAFor Respondent: Shri AR.V. Sreenivasan, Addl.CIT
Section 115BSection 143Section 143(2)Section 144Section 69A

unexplained cash deposit added u/s.69A of the Act and taxed u/s.115BBE of the Act amounting to Rs.31,13,500/- and assessing ‘income from other sources’ at Rs.22,97,140/-. The ld.AR stated that the CIT(A)-NFAC has given his adjudication as under:- 6. Ground no. 6: This ground pertains

M/S. Karnataka Power Transmiss, Raichur vs. Income Tax Officer, Ward-1, Raichur

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 994/BANG/2024[2020-21]Status: DisposedITAT Bangalore24 Jun 2024AY 2020-21

Bench: Shri Chandra Poojari & Shri Prakash Chand Yadavassessment Years : 2020-21 M/S Karnataka Power Transmiss, Vs. The Income Tax Officer, Ward – 1, 71-71, Kptcl Employee Co-Op. Power Raichur. House, Station Road, Raichur – 584 102. Pan – Aaaak 4223 F Appellant Respondent Assessee By : Smt. Sunaiana Bhatia, C.A Revenue By : Shri Ganesh R Gale, Standing Counsel For Department Date Of Hearing : 20.06.2024 Date Of Pronouncement : 24.06.2024 O R D E R Per Shri Prakash Chand Yadavthe Present Appeal Of The Assessee Is Arising From The Order Passed By The Nfac, Delhi Dated 29/04/2024 In Din No. Itba/Nfac/S/ 250/2024-25/1064431034(1) For The Assessment Year 2020-21. 2. The Assessee Is Cooperative Society Registered Under The Karnataka State Co-Operative Society’S Act 1959. The Society Is Engaged In The Activity Of Carrying Of Business Of Providing Credit Facilities To Its Members. It Filed Its Return Of Income On 24/09/2020 Declaring Nil Income. The Case Of The Assessee Was Selected For Scrutiny After Issuing Statutory Notices. During The Course Of Assessment Proceedings, Page 2 Of 4 The Ao Observed That The Assessee Has Earned Interest Income Received From Cooperative Institutions Amounting To Rs.10,12,973/- & Dividend Income Of Rs.1,13,240/-. The Ao Relying On The Judgment Of Dcit Vs. Totagars Co-Operative Society Ltd, Has Held That Assessee Is Not Entitled For Deduction On The Amounts Of Interest Income As Well As Dividend Income. Accordingly, The Ao Assessed That Income Under The Head ‘Income From Other Sources’ & Made An Addition Of Rs 11,86,369/-.

For Appellant: Smt. Sunaiana Bhatia, C.AFor Respondent: Shri Ganesh R Gale, Standing Counsel for Department
Section 250(6)Section 57Section 80P(2)(a)Section 80P(2)(d)

entitled for deduction on the amounts of interest income as well as dividend income. Accordingly, the AO assessed that income under the head ‘income from other sources’ and made an addition of Rs 11,86,369/-. 3. Aggrieved with the order of the AO, the assessee filed appeal before ... prejudice to the above, we make it clear that if the interest earned by assessee from the banks is considered under the head "Income from other sources", relief to be granted to the assessee u/s 57 of the Act in accordance with law. Accordingly, the issue is restored