Joint Account

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 December 2010 Mr. X & Mrs. X have Joint Bank Account.
Rs. 500000/- is Lying in the Account & That of Mrs. X.

Cheque Issued From Joint Account For Rs. 5 Lacs in Favour of Proprietorship Firm of Mr. X as a Loan.

Mr. X has Signed The Cheque But Amt. Lying in the Account Belongs to Mrs. X.

Now AO Says That This Amt. Belongs to Mr. X & Only Dummy Name Has Been Mentioned .

He Wants To Treat The Amt. as Undisclosed Income.

Now My Question is Whether the Contention of AO is Correct or If any Case Law Belong to Such Matter.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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05 December 2010 Rs 5.00 lac, which is lying in the bank belong to Mrs X, if you can prove so by any documentary evidence, or if you can explain how and why this amount belongs to MRs X ITO can not take such contention on the ground of just signing a cheque.

By just saying that amount belongs to MRs X , as it does not belong to Mr X, you can not avoid addition.
If Mrs X is an assessee and the amount can be substantiated with the returns filed, produce such details before the ITO.

If Mrs X is not assessee explain the sources from where she had got money?

If ITO can not be proved wrong in his contention, he will be right.

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