Smt. Rupalidevi Anilkumar Malu, RAJKOT-GUJARAT V. The Additional Commissioner of Income Tax, Gandhidham Range, GANDHIDHAM

ITA 1204/RJT/2010

• Counselvise Citation: 120424914 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 16-05-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 04-10-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VILAS V SHINDE
• Keywords: Gift; Question of law
• Section: 133A; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI T.K. SHARMA (JUDICIAL MEMBER) AND SHRI A.L. GEHLOT (AM) I.T.A. NO1204/RJT/2010 (ASSESSMENT YEAR 2005-06) SMT. RUPALIDEVI ANILKUMAR MALU VS ADDL CIT, GANDHI DHAM RANGE C/O KALPESH S DOSHI & CO GANDHIDHAM 411, COSMO COMPLEX MAHILA COLLEGE CIRCLE RAJKOT 360 001 PAN : AFKPM8878F (APPELLANT) (RESPONDENT) DATE OF HEARING : 11-11-2011 DATE OF PRONOUNCEMENT : 11-11-2011 APPELLANT BY : SHRI KALPESH DOSHI RESPONDENT BY: SHRI VILAS V SHINDE O R D E R PER AL GEHLOT (AM) THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF CIT(A)-II, RAJKOT DATED 16-07-2010 FOR THE ASSESSMENT YEAR 200 5-06. 2. THE GROUND RAISED IN THE APPEAL IS IN RESPECT OF ADDITION OF RS.14 LAKHS ON ACCOUNT OF UNEXPLAINED GIFT U/S 68 OF THE ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A HOUSE WIFE DERIVING INCOME FROM HOUSE PROPERTY AND INTEREST. DURING TH E ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE REC EIVED GIFTS OF RS.14 LAKHS FROM THREE PERSONS BASED AT KOLKATA. ON ENQUIRY, THE AS SESSING OFFICER FOUND THAT THE ITA NO.1204/RJT/2010 2 ASSESSEE HAS FAILED TO PRODUCE THE DONORS. THE ASS ESSEE HAS ALSO FAILED TO ESTABLISH RELATIONSHIP BETWEEN THE ASSESSEE AND THE DONORS. THE ASSESSEE FAILED TO PROVE THE GENUINENESS OF THE GIFTS. THER EFORE, THE ASSESSING OFFICER MADE THE ADDITION U/S 68 OF THE ACT. THE CIT(A) CO NFIRMED THE ADDITION. THE LD.AR SUBMITTED THAT THE GIFTS WERE RECEIVED THROUG H BANKING CHANNEL AND IN SUPPORT OF THE CLAIM THE ASSESSEE FILED AFFIDAVITS, COPY OF RETURNS AND PERMANENT ACCOUNT NUMBER OF DONORS. IT IS ALSO THE SUBMISSIO N OF THE LD.AR THAT THE COPIES OF THE MATERIAL / INFORMATION COLLECTED IN SURVEY C ONDUCTED U/S 133A WERE NOT GIVEN TO THE ASSESSEE. THE LD.AR SUBMITTED THAT TH E ASSESSEE WILL PRODUCE THE DONORS FOR EXAMINATION. 4. THE LD.DR, ON THE OTHER HAND, RELIED UPON THE OR DER OF THE REVENUE AUTHORITIES. 5. WE HAVE HEARD THE LD.REPRESENTATIVES OF THE PART IES, RECORD PERUSED. IN THE LIGHT OF ABOVE SUBMISSION OF THE LD.AR AND IN T HE LIGHT OF REASONED ORDER OF ITAT, RAJKOT BENCH IN THE CASE OF ITA NO.438/RJT/20 05 JAYANTILAL G KUNDALIYA & ORS ORD DATED 24-06-2011 WHEREIN THE TRIBUNAL BY FO LLOWING THE JUDGMENT OF THE APEX COURT IN THE CASE OF CIT VS P MOHANA KALA (200 7) 291 ITR 278 (SC) HAS SENT BACK THE MATTER TO THE FILE OF THE ASSESSING O FFICER WITH THE FOLLOWING OBSERVATIONS: 17. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND HAVE ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY, ITA NO.1204/RJT/2010 3 CASH CREDIT WAS FOUND IN THE FORM OF NRI GIFT. THE ASSESSEE CLAIMED THAT THE DONOR IS A FRIEND. ADMITTEDLY, TH E DONOR IS NOT A RELATIVE OF THE ASSESSEE. NORMALLY THERE SHOULD BE AN OCCASION FOR GIVING GIFT BY A PERSON, WHO IS NOT BLOOD RELATIVE. IN CASE OF BLOOD RELATIVE ONE MAY SAY THAT NO OCCASION IS REQUIRED F OR GIVING GIFT. MOTHER, FATHER, BROTHER, SISTER MAY GIFT AT ANY TIM E TO THEIR CHILDREN / GRAND CHILDREN, BROTHER, SISTER RESPECTIVELY. BUT THAT IS NOT THE CASE IN RESPECT OF OTHER PERSONS. NORMALLY, THE THIRD P ARTIES WOULD GIFT ON AN OCCASION. SUCH A GIFT IS ALSO NEEDS TO BE RECIP ROCATED APPROPRIATELY. ALL THESE FACTS WOULD DEPENDENT UPON THE FACTS OF EACH CASE. ONE CANNOT LAY DOWN ANY RULE / PRESCRIPT ION FOR GIVING / RECEIVING GIFTS. IT IS TO BE ESTABLISHED SATISFACT ORILY DEPENDING UPON THE FACTS OF EACH CASE. 18. WE FIND THAT THE APEX COURT IN THE CASE OF P MO HANA KALA (SUPRA) HAD AN OCCASION TO CONSIDER AN IDENTICAL SE T OF FACTS. IN THE CASE BEFORE THE APEX COURT, THE ASSESSEE RECEIVED F OREIGN GIFT FROM A DONOR. THE PAYMENT WAS MADE THROUGH BANKING CHAN NEL AND IT WAS CREDITED IN THE BANK ACCOUNT. THE DONOR IN THE CASE BEFORE APEX COURT CLAIMED THAT HE WAS PAYING TAX IN ENGLAN D AND HAD SUFFICIENT FUNDS FOR GIVING GIFT. THE APEX COURT F OUND THAT THE STATEMENT MADE BY THE DONOR IS A SELF-SERVING STATE MENT AND THERE IS NO MATERIAL EVIDENCE AS REGARDS TO HIS FINANCIAL STATUS. ULTIMATELY, THE APEX COURT FOUND THAT THE TRANSACTI ONS THOUGH APPARENT WERE HELD TO BE NOT REAL ONES. MAY BE THE MONEY CAME BY WAY OF BANK CHEQUE AND WAS PAID THROUGH THE PROC ESS OF BANKING TRANSACTION BUT THAT ITSELF IS OF NO CONSEQ UENCE. IN FACT, THE APEX COURT OBSERVED ON PAGE 289 OF THE ITR, AS FOLL OWS: RELYING ON THE DECISIONS OF THIS COURT IN BEJOY G OPAL MUKHERJI V. PRATUL CHANDRA GHOSE, AIR 1953 SC 153 A ND ORIENT DISTRIBUTORS V. BANK OF INDIA LTD. AIR 1979 SC 867, SHRI IYER, LEARNED SENIOR COUNSEL CONTENDED THAT THE ISSUE REL ATING TO THE PROPRIETY OF THE LEGAL CONCLUSION THAT COULD BE DRA WN ON THE BASIS OF PROVED FACTS GIVES RISE TO A QUESTION OF LAW AND, T HEREFORE, THE HIGH COURT IS JUSTIFIED IN INTERFERING IN THE MATTER SIN CE THE AUTHORITIES BELOW FAILED TO DRAW A PROPER AND LOGICAL INFERENCE FROM THE PROVED FACTS. WE ARE UNABLE TO PERSUADE OURSELVES TO ACCE PT THE SUBMISSIONS. THE FINDINGS OF FACT ARRIVED AT BY TH E AUTHORITIES BELOW ARE BASED ON PROPER APPRECIATION OF THE FACTS AND THE MATERIAL AVAILABLE ON RECORD AND SURROUNDING CIRCUM STANCES. THE DOUBTFUL NATURE OF THE TRANSACTION AND THE MANNER I N WHICH THE SUMS WERE FOUND CREDITED IN THE BOOKS OF ACCOUNTS M AINTAINED BY THE ASSESSEE HAVE BEEN DULY TAKEN INTO CONSIDERATIO N BY THE AUTHORITIES BELOW. THE TRANSACTIONS THOUGH APPAREN T WERE HELD TO BE NOT REAL ONES. MAY BE THE MONEY CAME BY WAY OF BANK CHEQUES ITA NO.1204/RJT/2010 4 AND PAID THROUGH THE PROCESS OF BANKING TRANSACTION BUT THAT ITSELF IS OF NO CONSEQUENCE. IN VIEW OF THE ABOVE MERELY BECAUSE THE TRANSACTION WAS MADE THROUGH BANKING CHANNEL THAT ALONE WILL NOT PROVE T HE GENUINENESS OF THE TRANSACTION. SOMETHING MORE IS REQUIRED TO BE PROVED IN RESPECT OF FOREIGN GIFT. BOTH THE AUTHORITIES BELO W HAD NO OCCASION TO CONSIDER THIS JUDGMENT OF THE APEX COURT IN THE CASE OF P MOHANA KALA (SUPRA). THE ASSESSEE HAD ALSO NO OCCA SION TO EXPLAIN THE CONSEQUENCE OF THE JUDGMENT OF THE APEX COURT IN THE CASE OF P MOHANA KALA (SUPRA). THEREFORE, IN OUR O PINION, THE MATTER NEEDS TO BE RECONSIDERED BY THE ASSESSING OF FICER IN THE LIGHT OF THE JUDGMENT OF THE APEX COURT IN THE CASE OF P MOHANA KALA (SUPRA) AFTER GIVING ADEQUATE OPPORTUNITY TO THE AS SESSEE. 19. WE HAVE ALSO GONE THROUGH THE DECISION OF THE M UMBAI BENCH OF THE TRIBUNAL IN THE CASE OF MRS. ASHA HAMP ANNAVAR (SUPRA). IN THE CASE BEFORE THE MUMBAI BENCH OF TH E TRIBUNAL, THE DONOR WAS FOUND TO BE NOT A STRANGER TO THE ASSESSE E. THE MUMBAI BENCH AFTER EXAMINING THE FACTS OF THE CASE FOUND THAT THE GENUINENESS OF THE TRANSACTION WAS ESTABLISHED BY T HE ASSESSEE. ON FURTHER APPEAL BY THE REVENUE BEFORE THE BOMBAY HIGH COURT, THE BOMBAY HIGH COURT FOUND THAT THERE IS ABSOLUTEL Y NO QUESTION OF LAW ARISE FOR CONSIDERATION. SIMILARLY, THE APE X COURT REJECTED THE SPECIAL LEAVE PETITION OF THE REVENUE ON THE GR OUND THAT THE HIGH COURT FOUND THAT THE GIFT WAS GENUINE AND NO M ATERIAL WAS AVAILABLE ON RECORD TO SHOW THAT THE CONFIRMATION W AS NOT CORRECT. THEREFORE, IT IS CLEAR THAT EACH CASE HAS TO BE EXA MINED ON ITS OWN FACTS AND WE HAVE TO FIND OUT THE GENUINENESS OF TH E TRANSACTION. THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL UP HOLDING THE GENUINENESS OF THE TRANSACTION WAS CONFIRMED BY THE BOMBAY HIGH COURT ON THE GROUND THAT THERE IS NO QUESTION OF LA W. NO LAW WAS LAID DOWN BY THE APEX COURT WHILE REJECTING THE SLP . HOWEVER, IN THE CASE OF P MOHANA KALA (SUPRA), THE HONBLE APEX COURT EXAMINED THE ISSUE IN DEPTH AND CATEGORICALLY HELD THAT MERELY BECAUSE THE TRANSACTION WAS MADE THROUGH BANKING CH ANNEL THAT ALONE WILL NOT ESTABLISH THE GENUINENESS OF THE TRA NSACTION. MOREOVER, BOTH THE AUTHORITIES BELOW, HAVE NOT EXAM INED THE ISSUE OF FOREIGN GIFT IN THE LIGHT OF THE JUDGMENT OF THE APEX COURT IN THE CASE OF P MOHANA KALA (SUPRA). THEREFORE, IN OUR O PINION, THE FACTS OF THE CASE NEED TO BE EXAMINED IN THE LIGHT OF THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF P MOHANA KALA (SU PRA). ACCORDINGLY WE SET ASIDE THE ORDERS OF LOWER AUTHOR ITIES AND REMAND BACK THE MATTER TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL EXAMINE THE ISSUE AFRESH AN D THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER CONSID ERING THE ITA NO.1204/RJT/2010 5 JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF P MOHANA KALA (SUPRA). NEEDLESS TO POINT OUT THAT THE ASSESSING OFFICER SHALL GIVE SUFFICIENT OPPORTUNITY TO THE ASSESSEE BEFORE DECID ING THIS ISSUE. 6. IN THE LIGHT OF THE ABOVE, WE SEND BACK THIS MAT TER TO THE FILE OF THE ASSESSING OFFICER WITH IDENTICAL DIRECTION AS GIVEN BY ITAT IN THE ABOVE ORDER AS ALSO IN THE LIGHT OF THE SUBMISSIONS OF THE LD.AR. THE ASSESSING OFFICER WILL PASS THE ORDER AFRESH AFTER PROVIDING REASONABLE OPPORTU NITY TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED, FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 11-11-2011. SD/- SD/- (T.K. SHARMA) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER RAJKOT, DT : NOVEMBER, 2011 PK/- COPY TO: 1. ASSESSEE 2. REVENUE 3. THE CIT(A)-II, RAJKOT 4. THE CIT-I, RAJKOT 5. THE DR, I.T.A.T., RAJKOT (TRUE COPY) BY ORDER ASSTT.REGISTRAR, ITAT, RAJKOT