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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

Bhawani Shanker Gupta, New Delhi vs. ITO, Ward- 24(3), New Delhi

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

ITA 1324/DEL/2018[2008-09]Status: DisposedITAT Delhi10 Jun 2021AY 2008-09

Bench: Shri R.K. Pandaassessment Year: 2008-09 Bhawani Shanker Gupta, Vs Ito, 18, Asola Village, Fatehpur Beri, Ward-24(3), Near Mcd Hospital, New Delhi. New Delhi. Pan: Aanpg5347D (Appellant) (Respondent) Assessee By : Shri Lalit Mohan, Ca Revenue By : Shri R.K. Gupta, Sr. Dr Date Of Hearing : 20.05.2021 Date Of Pronouncement : 10.06.2021 Order This Appeal Filed By The Assessee Is Directed Against The Order Dated 13.11.2013 Of The Cit(A)-11, New Delhi, Relating To Assessment Year 2008-09. 2. Facts Of The Case, In Brief, Are That The Assessee Is An Individual & Engaged In The Business Of Retail Trading Of Building Material. He Filed His Return Of Income On 31St July, 2008 Declaring The Total Income At Rs.1,07,216/-. The Case Of The Assessee Was Selected For Scrutiny Through Cass. In This Case Air Information Was Also Received For Deposit Of Cash Above Rs.10 Lakhs.

For Appellant: Shri Lalit Mohan, CAFor Respondent: Shri R.K. Gupta, Sr. DR
Section 44ASection 80C

tune of Rs.78,480/- had shown a net profit of Rs.1,02,080/-. The assessee has also shown Rs.11,415/- as ‘income from other sources.’ In the details submitted by the assessee, vide letter dated 25.11.2010, the assessee revised the gross receipt amount to Rs.7,08,320/- and declared profit ... Rs.35,416/- u/s 44AF of the Act and also shown short-term capital gain of Rs.66,664/- apart from “Income from other sources” of Rs.11,415/-. The AO, thereafter, asked the assessee to explain the source of cash deposit amounting to Rs.10,19,000/-. It was explained that the deposits