How the following item will be treated under IT ACT ?
An assessee found 20 Kg of Gold and Rs.2,00,000 of Cash while digging his own Land.
[ Assumption : The above items are not an ancestral property or the evidence is not available w.r.t title of above goods ]
Q 1 How it will be taxed under IT ACT ?
Q.2 Any other laws to be followed in this regard ? under which ACTs ?
Such Income will be taxed under the head "Income From Other Sources" u/s 56(2) i.e., Receipt without Consideration. This is my personal opinion.
Comments of the senior members are solicited.
Hi Sir,
Interesting question - My thinking says -
It cannot be taxed under Income Tax Act - It is not an "Income", provided he can prove that he acquired them on digging otherwise Sec 69A can be invoked-
69A. Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the [Assessing] Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year.]
Wealth Tax shall be levid on these two items.
HI Akhil,
Initially I was also thinking on same lines but It cannot be made taxable u/s 56(2)-
Sec 56(2)(vii) - where an individual or a Hindu undivided family receives, in any previous year, from any person or persons on or after the 1st day of October, 2009
No other person is involved in this case......
Whether the goods become the property of Government in this case ???????
Based on your opinions and provisions made under IT ACT the above items prima facie taxable
Now the problem is WHETHER SUCH GOODS BECOME THE PROPERTY OF GOVERNMENT UNDER ANY LAW ?
LEGAL ADVICE IS NEEDED ...PLEASE HELP ME OUT !!
CAclubindia
