Sri P Appala Narasimhulu (alias P Rajesh), Visakhapatnam V. The ACIT, Circle-4(1), Visakhapatnam

ITA 105/VIZ/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 0653 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 17-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G S S GOPINATH
• Assessee Lawyers: P RAMAKRISHNA
• Keywords: Gift; Set aside

Judgement Text

ITA NO. 105/VIZAG/2010 P. APPALA NARASIMHULU (ALIAS P.RAJESH), VISAKHAPATN AM PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI BR BASKARAN, ACCOUNTANT MEMBER ITA NO.105/VIZAG/2010 ASSESSMENT YEAR: 2005-06 P. APPALA NARASIMHULU (ALIAS P RAJESH), VISAKHAPATNAM ACIT, CIRCLE-4(1), VISAKHAPATNAM (APPELLANT) PAN NO: AAPPP 5958 F VS. (RESPONDENT) APPELLANT BY: SHRI P. RAMAKRISHNA, CA RESPONDENT BY: SHRI G.S.S. GOPINATH, (DR) ORDER PER SHRI B. R. BASKARAN, ACCOUNTANT MEMBER: THE APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 10-12- 2009 PASSED BY LD CIT(A) AND IT RELATES TO THE ASSE SSMENT YEAR 2005-06. 2. THE ASSESSEE IS ASSAILING THE DECISION OF LE ARNED CIT(A) IN CONFIRMING THE ADDITION OF RS.5,54,869/- MADE U/S 56(2)(V) OF THE ACT. 3. THE UNDISPUTED FACT IS THAT THE ASSESSEE IS THE PROPRIETOR OF M/S RAJESH TRANSPORTS. HE RECEIVED A GIFT OF RS.5,54,8 69/- FROM HIS FRIEND NAMED SRI KALYAN KUMAR BITRA BY WAY OF CHEQUE. THE SAID CHEQUE WAS DEPOSITED INTO THE BANK ACCOUNT OF HIS PROPRIETARY CONCERN, VIZ., M/S RAJESH TRANSPORTS ON 05.4.2004. ACCORDING TO THE ASSESSEE HE CREDITED THE SAID AMOUNT IN THE ACCOUNT ENTITLED GIFT RECEIVED ACCOU NT IN THE BOOKS OF M/S RAJESH TRANSPORT AND AT THE YEAR END, I.E. ON 31.3. 2005, THE AMOUNT STANDING IN THE GIFT RECEIVED ACCOUNT WAS TRANSFE RRED TO THE CAPITAL ACCOUNT OF THE ASSESSEE. BEFORE THE ASSESSING OFFI CER, THE ASSESSEE DID NOT PRODUCE BOOKS OF ACCOUNT AND OTHER DOCUMENTS AND HE NCE THE ASSESSING OFFICER TREATED THE DATE OF RECEIPT OF GIFT AS 31.3 .2005 AND ACCORDINGLY INVOKED THE PROVISIONS OF SECTION 56(2)(V) OF THE A CT TO TREAT THE SAID GIFT AS ITA NO. 105/VIZAG/2010 P. APPALA NARASIMHULU (ALIAS P.RAJESH), VISAKHAPATN AM PAGE 2 OF 3 THE INCOME OF THE ASSESSEE. HOWEVER, BEFORE LEARNE D CIT(A) THE ASSESSEE PRODUCED COPIES OF LEDGER ACCOUNTS AND ALSO A CONFI RMATION LETTER OBTAINED FROM THE DONOR. THE LEARNED CIT(A) CONFIRMED THE A CTION OF THE ASSESSING OFFICER WITH THE FOLLOWING OBSERVATIONS: FROM THE DOCUMENTARY EVIDENCE FILED BY THE APPELL ANT, IT IS CLEAR THAT THE ABOVE SAID AMOUNT WAS CREDITED TO TH E BANK ACCOUNT OF M/S RAJESH TRANSPORT AND NOT TO THE APPE LLANTS ACCOUNT ON 15.04.2004. (SIC). THEREFORE, THE AMOUNT TRANSFERRED TO CAPITAL ACCOUNT OF THE APPELLANT AS ON 31.3.2005 HAS RIGHTLY BEEN BROUGHT TO TAX UNDER THE PROVISIONS OF SEC. 52 (2)(V) (SIC) OF THE INCOME TAX ACT, 1961. 4. THE OBSERVATIONS OF LEARNED CIT(A) GIVES AN I MPRESSION THAT THE FIRST APPELLATE AUTHORITY WAS UNDER THE IMPRESSION THAT T HE ASSESSEE AND THE CONCERN M/S RAJESH TRANSPORTS ARE TWO DIFFERENT ENT ITIES, WHICH IS FACTUALLY INCORRECT. FURTHER THE LEARNED CIT(A) HAS NOT COMM ENTED UPON THE DOCUMENTARY EVIDENCES FILED BEFORE HER FOR THE FIRS T TIME, NOR DID SHE OBTAIN A REMAND REPORT FROM THE ASSESSING OFFICER O N THOSE DOCUMENTS. FURTHER THE LEARNED CIT(A) HAS NOT DEALT WITH THE I SSUE RELATING THE DATE OF RECEIPT OF GIFT, WHICH IS THE MAIN ISSUE IN THIS AP PEAL. IN VIEW OF THE DEFICIENCIES POINTED ABOVE, WE ARE OF THE VIEW THAT THE ISSUE NEEDS TO BE EXAMINED AFRESH BY LEARNED CIT(A). ACCORDINGLY WE SET ASIDE THE ORDER PASSED BY LEARNED CIT(A) AND RESTORE THE ISSUE BACK TO THE FILE OF FIRST APPELLATE AUTHORITY FOR FRESH CONSIDERATION IN ACCO RDANCE WITH LAW. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 29.6.2010. SD/- SD/- (SUNIL KUMAR YADAV) (B R BASKARAN ) JUDICIAL MEMBER ACCOUNTANT MEMBER PVV/SPS VISAKHAPATNAM, DATE: 29 TH JUNE, 2010 ITA NO. 105/VIZAG/2010 P. APPALA NARASIMHULU (ALIAS P.RAJESH), VISAKHAPATN AM PAGE 3 OF 3 COPY TO 1 SHRI P. APPALA NARASIMHULU (ALIAS P RAJESH),. 47- 10-13, 1 ST FLOOR, REDNAM PLAZA, DWARAKANAGAR, VISAKHAPATNAM 530 016 2 THE ACIT, CIRCLE-4(1), VISAKHAPATNAM 3 4. THE CIT 2, VISAKHAPATNAM THE CIT(A), VISAKHAPATNAM 5 THE DR, ITAT, VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM