DCIT, INTERNATIONAL TAXATION, JAIPUR, JAIPUR V. KAVITA CHHUGANI, JODHPUR

ITA 127/JPR/2025

AI Insights

The case involves the Dy. Commissioner of Income Tax, Circle (International Taxation), Jaipur as the appellant and Kavita Chhugani as the respondent. The core issue revolved around the deletions of certain additions made by the Assessing Officer (AO) under sections 69 and 69A of the Income Tax Act, 1961, concerning unexplained investments and unexplained cash credits in the assessee's bank account. The CIT (A) had allowed the assessee's appeal, leading to the revenue's appeal to the Income Tax Appellate Tribunal. The tribunal examined the submissions, the orders of the AO, and the CIT (A), and found that the CIT (A) had correctly appreciated the evidence provided by the assessee, including bank statements and gift deeds from her son and daughter-in-law, which were crucial in substantiating the sources of the funds used for property purchases and other transactions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312326 (ITAT-JAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH KHANDELWAL; LD; ADMITTING ADDITIONAL EVIDENCES
• Assessee Lawyers: ALKA GAUTAM; LD
• Keywords: Additional evidence; Unexplained investment; Gift
• Section: 147; 148; 142(1); 68; 69

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH “B”, JAIPUR BEFORE SHRI GAGAN GOYAL, ACCOUNTANT MEMBER AND SHRI NARINDER KUMAR, JUDICIAL MEMBER ITA No. 127(A.Y. 2018-19)/JPR/2025 Dy. Commissioner of Income Tax, Circle (International Taxation), Jaipur. ..... Appellant Vs. Kavita Chhugani, B-43, Shastri Nagar, Jodhpur. PAN No. AAIPC9720F …...Respondent Appellant by : Mr. Ashish Khandelwal, C.A., Ld. AR Respondent by : Mrs. Alka Gautam, CIT, Ld. DR Date of hearing : 28/04/2025 Date of pronouncement : 28/04/2025 O R D E R PER GAGAN GOYAL, A.M: This appeal by revenue is directed against the order of CIT (A), Delhi-42 dated 02.12.2024 passed u/s. 250 of the Income Tax Act, 1961 (in short ‘the Act’). The revenue has raised the following grounds of appeal: - 1.1 On the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) has erred in deleting the addition of Rs. 49,50,000/- made u/s. 69A of the 1.T. Act 1961 by allowing the appeal of the assessee further failed to appreciate the findings of the AO that the assessee did 2 not submit the bank account statement of bank account no. 31879028039 maintained with State Bank of India in the name of Sh. Ishu Chhugani & Mrs. Simran Ishu Chhugani (Son and Daughter-in-law) and copy of gift deed from his son and daughter-in-law. 1.2 On the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) has erred in deleting the addition of Rs 81,72,000/- made on account of unexplained investment for purchasing the immovable properties u/s. 69 of the 1.T. Act 1961 by allowing the appeal of the assessee. The Ld. CIT (A) has failed to appreciate the findings of the AO that the assessee did not submit the supporting documents to explain the source of the said transactions during the assessment proceedings. 1.3 On the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) has erred in deleting the addition of Rs 1, 06,575/- made u/s. 69A of the 1.T. Act 1961 by allowing the appeal of the assessee. The Ld. CIT (A) has failed to appreciate the findings of the AO that the assessee did not submit the supporting documents to explain the source of the said transactions during the assessment proceedings. 1.4 On the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) has erred in admitting the additional evidences filed by the assessee in contravention to rule 46A of the Income Tax Rules which mandates that no additional evidence shall be admitted by the CIT (Appeals) without providing opportunity to the AO to examine the evidence or document or to cross-examine the witness produced by the appellant. 1.5 Whether on the facts and in the circumstances of the case and in law, the learned. Commissioner of Income Tax (Appeals) is justified in assuming the powers vested to the Assessing officer to examine the evidence or document or to cross- examine the witness produced by the appellant by admitting additional evidences without providing opportunity to the AO? 2. The appellant craves leave to add, amend or withdraw any of the ground of appeal during the course of appellant proceeding. 2. The brief facts of the case are that the assessee individual being Non- Resident Indian (NRI) is non filer of return. Information in this received from AIR Information/ TAS/ 26AS Details. On this information a notice u/s. 148 of the Act 3 was issued vide dated: 30.03.2022. In response to this notice the assessee filed her ITR u/s. 148 of the Act vide dated: 18.08.2022 declaring total income at Rs. 1, 24,180/-. Then Statutory Notices issued u/s. 142(1) and 143(2) were issued. A draft assessment order was passed in the case of the assessee u/s. 144C (3) of the Act being an eligible assessee for this section. Ultimately, the final assessment order was passed u/s. 147 r.w.s. 144C(3) of the Act after making additions of Rs. 1,32,28,580/- totaling Rs. 1,33,52,760/-. The assessee being aggrieved with the same preferred an appeal before the Ld. CIT (A), who in turn allowed the appeal of the assessee. Now the department being aggrieved preferred the present appeal before us. 3. We have gone through the order of the AO, order of the Ld. CIT (A) and submissions of both sides alongwith grounds taken by the Revenue. It is observed that the assessee under consideration is an NRI and having income from other sources and rental income. In his assessment order the AO made two major additions of Rs. 81.72 Lacs and 49.50 Lacs alongwith a small addition of Rs. 1, 06,575/- u/s. 69 and 69A of the Act respectively. The assessee purchased two properties of Rs. 39 Lacs each and paid registration charges of Rs. 1.86 Lacs each, totaling Rs. 71.2 Lacs. In the year under consideration Rs. 2,62,354/- and 3 Lacs only (for each flat, in addition to Rs. 1.86 Lacs each for registration) was paid remaining amount of Rs. 36,37,646/- and 36 Lacs each was paid in the earlier years. 4. We have considered the factual findings of the Ld. CIT (A) vis-à-vis the bank statements of the assessee for verification purposes. It is observed that during the year under consideration the assessee paid only Rs. 5, 62,354/- (Rs. 262354 + Rs. 4 3 Lacs) towards final payment of both the properties mentioned above and Rs. 3.72 Lacs (Rs. 1.86 Lacs each) towards payment of registration charges. The assessee received money from her son and daughter-in-law (Mr. Ishu Dileep Chhugani and Mrs. Simran Ishu Chhugani) in her bank account, out of which payments of Rs. 562354/- and Rs. 3.72 Lacs were made. In support of this the assessee submitted Copies of Gift Deeds from both the relatives. The assessee received this money from NRE/NRO accounts of her son and daughter-in-law maintained in State Bank of India (SBI) and HDFC Bank respectively vide account nos. 31879028039 and 10851000011492 respectively. Copies of registration deed of properties are placed on record having clear reference of the assessee’s bank details as claimed by her and copies of relevant bank statement are also there for our perusal. In view of the above, we confirm the order of the Ld. CIT (A) and find no anomaly in the order passed against the AO. Relevant ground on this issue raised by the department is dismissed. 5. Next issue pertains to receiving Rs. 49.5 Lacs during the year by the assessee in her bank account. It is observed that vide para 10.1 of the Ld. CIT(A) it is tabulated in terms of date of receiving, amount and transferor’s bank account details. To substantiate the Ld. CIT (A) relied upon the copies of bank statement submitted by the assessee before the AO and him. We have also verified the entries w.r.t. bank statement of the assessee and her son and daughter-in-law. Here it is worthwhile to mention that the assessee is receiving the money from his relations, which are in exempted category and can make gift without any tax implication under the head “Income from other sources”. As far as the ingredients (Identity, Creditworthiness and Genuineness) of section 68 of the Act are concerned, those are fully met by the assessee and we do not see any fault in the 5 findings of the Ld. CIT (A). In view of this Relevant ground on this issue raised by the department is dismissed. 6. On third issue relating to addition of Rs. 1, 06,575/-, we have gone though the findings of the Ld. CIT (A), wherein it was hold that the assessee earned rental income of Rs. 3, 20,250/- and the same has been offered for tax but still the AO doubly taxed the amount of Rs. 1, 06,575/- and the same is not tenable legally and factually. The findings of the Ld. CIT (A) on this issue are also sustained and relevant ground on this issue raised by the department is dismissed. 7. Ground nos. 1.4 and 1.5 relating to admission of additional evidence under rule 46A of the Rules without giving an opportunity to the AO is found to be an academic one, i.e. not a substantial ground, which confirms that the interest of the revenue is hurt with this action of the Ld. CIT (A) and prejudicial to the interest of revenue. Rules follow the substantive law and simply a part of procedure for better carriage of justice. Law certainly given ample powers to the first appellate authority and the revenue is failed to demonstrate that how this action of the Ld. CIT (A) affected their rights in the matter under consideration. In view of this the relevant grounds on this issue also dismissed. 8. In the result, the appeal of the revenue is dismissed. The Order is pronounced in the open court on the 28th day of April 2025. Sd/- Sd/- (NARINDER KUMAR) (GAGAN GOYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Jaipur, िदनांक/Dated: 28/04/2025 6 Copy of the Order forwarded to: 1. अपीलाथ /The Appellant , 2. \u000eितवादी/ The Respondent. 3. आयकर आयु\u0015 CIT 4. िवभागीय \u000eितिनिध, आय.अपी.अिध., Sr.DR., ITAT, 5. गाड फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar) ITAT, Jaipur Details Date Initials Designation 1 Draft dictated on PC on 28.04.2025 Sr.PS/PS 2 Draft Placed before author 28.04.2025 Sr.PS/PS 3 Draft proposed & placed before the Second Member JM/AM 4 Draft discussed/approved by Second Member JM/AM 5. Approved Draft comes to the Sr.PS/PS Sr.PS/PS 6. Kept for pronouncement on Sr.PS/PS 7. File sent to the Bench Clerk Sr.PS/PS 8 Date on which the file goes to the Head clerk 9 Date of Dispatch of order "