ARVINDBHAI VALJIBHAI BHANUSHALI

NOTES ON STATEMENT OF TOTAL INCOME

ASST.YEAR : 2009-10

1. The Assesse has filed her original return electronically on 28/10/2009 vide E-filing Acknowledgement Number-99913080281009. And also has filed Physical original Income-tax return u/s.139(1) of the I.T.Act, 1961 on 28/10/2009 with the office of Income Tax Officer ward-3,Kheda range,Nadiad vide R No. 495. This Income-tax Return is filed in response to notice dated 07/10/2010 issued by A.C.IT C.C.1(4) Ahmedabad u/s.153A of the I.T.Act, 1961

2. All supporting evidences filed with the original return of income are required to be considered as part and parcel of this Income-tax Return.

3. The search proceedings u/s.132 of the I.T. Act 1961 was carried out by the Income-tax Department on 04/03/2010 at the residential premises of the assessee. at 11C,Punit Park Society, opp. New Court, Mehmadavad . Proceedings u/s.132 of the Act was also carried out at the locker No.183 of State Bank Of India, at Mahemdavad . During the course of search following assets were found and seized.

Particulars Found Seized Annexure Amount Annexure Amount Gold Ornaments and Jewellery JF 24,80,615 -- Nil Cash CF 5,300 -- Nil

During the course of search proceedings, except aforesaid assets, no other assets have been found and seized. During the course of search proceedings, various loose papers and diaries were found and seized.

4. The assessee Arvindbhai V Bhanushali has carried out construction activities on job work /contract basis and income of which was not disclosed in the income tax return filed . The notings which found in seized materials of Annexure A-1 page No.-26 found and seized from the residential premises of assessee .The assesse has not maintained any records for the expenditure incurred ,hence the assessee has worked out the additional income as per provision of section 44AD of the Income tax Act 1961 and has worked and additional income @ 8% on Rs.13,63,330 (11,87,000+ 1,76,330) =Rs.1,09,066 . The assessee has offered the said additional income in this Income tax return. The working of which is attached herewith. The assessment authority worked out any income of the assessee then same is required to be given a telescoping effect against the additional income disclosed by the assessee in this income tax return.

5. The assessee has disclosed additional income in this income tax return suo motto and voluntarily hence no penalty proceedings should be imposed under the Income tax Act 1961

6. It is to be noted that whenever the assessing authority propose to compute additional income on the basis of source of income, the corresponding unexplained assets identification against the source of income is required to be established by the assessing authority with material evidences on record and in absence of such assets identification the income computed is merely notional and hypothetical income determined without observing the principle of real income as laid down by the Hon'ble Supreme Court and various High Courts.

7. The assessee contended that any additions/disallowance on account of difference of opinion as regards to any of statutory provisions as well as disallowance of concept of reasonability from the view of the assessing authority would not be treated as failure to disclose fully and truly material facts or furnishing of inaccurate particulars of income.

8. The assessee is not aware of any consequential enquiry which might have been carried out by the department and which may in the opinion of the department have the effect in the income disclosed in this return of income. Accordingly, it is contended that at the time of assessment proceedings, after taking into consideration the rebuttal placed by the assessee against the material/evidences brought to the notice of the assessee from the consequential enquiries carried out by the department, if any part of the explanation offered by the assessee would not be acceptable to the Assessing Authority, the same will not tantamount to failure on the part of the assessee to disclose the income truly and correctly

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9. The income under the provisions of Income-tax Act is required to be computed by the Assessing Officer on the basis of the principle of real income as discussed by the Hon'ble Supreme Court and various High courts. Hence, any income computed without following the principle of real income and without corroborative material/evidence brought on record and on the basis of mere hypothesis would tantamount to computing of notional income which is against the provisions of Income-tax Act.