Ao's power
seema
(Querist) 08 December 2012
This query is : Resolved
In a case of sec 148 under I.T. Act, where one has to show expenses on marriage in one's family and its sources ,what documents are needed to support that a fixed amount was spent on it? Documents /evidence are Bank account,affidavit from relatives regarding their contribution ,cash at hand..
1. Is this enough to prove that fixed amount was spent?If it is, Why the AO not satisfied with it?What else can be given as evidence when we have given all sources to meet the expenses?
2.AO says that in appeal they exempt genuine cases and yours is genuine with evidences so it will be exempted ,is it right?
prabhakar singh
(Expert) 08 December 2012
We can expense what we have then to prove that we had we need to show amount lying in Bank/or in other institutions as deposits,cash in hand which not be more than
50k,cash gifts of relatives which can not be more than 20k,any thing above it should be through bank transaction.If loans were raised for purpose,same rule shall apply.This is about source of expenditure.
Now coming to expenditure ,all bills and voucher of expenditure should be presented to corroborate the fact of expenditure under different heads.Again payments in cash above 20k should not be made at any date otherwise bank transaction would required.
seema
(Querist) 08 December 2012
1.If a relative who had no account at that time gave 50k as and another gave 30k from cash at hand,what will happen?
2.this reassesment was started on TEP filed by opponent spouse (because we filed dv against him)), he used our petition where we had stated that we had spent some lacs in marriage.so do we still need to cooroborate with bills etc. now because ITO himself has asked us to prove the source of expenses AMOUNTING TO that much fixed amount.So there should be no need of proving expenses with bills etc. on our part , am i right?infact we have very few bills left because of timelag.
Raj Kumar Makkad
(Expert) 08 December 2012
1. such claimed amount over Rs. 20,000/- shall be deemed as not given and thus shall be taxable.
2. You can very well claim having lost all those vouchers except available so that the matter may be got reconciled.
seema
(Querist) 09 December 2012
1.does that mean every relative's 20,000 contribution will be taken into account as expenses and only the amount above that will be taxable?
2.how do they reconcile in absence of bills in this case?
prabhakar singh
(Expert) 09 December 2012
1.If a relative who had no account at that time gave 50k as and another gave 30k from cash at hand,what will happen?
Ans:on record it should be so bifurcated that any entry on a particular date does not exceed the limit of 20 k.
2.this reassesment was started on TEP filed by opponent spouse (because we filed dv against him)), he used our petition where we had stated that we had spent some lacs in marriage.so do we still need to corroborate with bills etc. now because ITO himself has asked us to prove the source of expenses AMOUNTING TO that much fixed amount.So there should be no need of proving expenses with bills etc. on our part , am i right?in fact we have very few bills left because of time lag.
Answer: Yes in that case you are right.
Raj Kumar Makkad
(Expert) 09 December 2012
1. Yes.
2. As the bills are not readily available so a rough guess shall be made and accordingly the accounts shall eb settled.
prabhakar singh
(Expert) 09 December 2012
If he is not asking to prove expenditure but only source to expenditure then prove source only.
Raj Kumar Makkad
(Expert) 09 December 2012
Expenditure has already been claimed by you on the marriage so nothing requires more to add.
ajay sethi
(Expert) 09 December 2012
well advised by experts
seema
(Querist) 09 December 2012
Can we tell AO in writing that Rs. 20 000 must be accounted to all relatives ,then cash at hand must be accounted to 50000,,hence AO should give the amount in reassessment accordingly and not arbitrarly because he is not taking any of tehm in consideration?If they ask for refrence of rules of calculation stated by you then?
Raj Kumar Makkad
(Expert) 09 December 2012
Instead of taking a specific and sole defence only on the basis of online advice is not desired. Engage local lawyer dealing in taxation side and prepare your line of action as per his advice who shall be in a better position to deal with you case.
