B.K. Lokesh, Bangalore V. ACIT, Bangalore

ITA 1265/BANG/2012

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9460 (ITAT-BANGALORE)
• Duration Of Justice: 3 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 14-07-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 27-09-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: TSHERING ONGDA
• Assessee Lawyers: ASHOK KULKARNI
• Keywords: Gift

Judgement Text

IN THE INCOME TAX APPELLATE TRI BUNAL BANGALORE BENCH A, BANGALORE BEFORE SHRI A.K.GARODIA, ACCOUNANT MEMBER (SMC) ITA NOS.1265 TO 1267(BANG) 2012 (ASSESSMENT YEARS : 2003 04, 2004 05 & 2007 08) SHRI B. K. LOKESH, NO. 203, 3 RD MAIN, 5 TH CROSS, CHAMARAJPET, BANGALORE PAN NO. ABQPL5469H APPELLANT VS THE ACIT, CENTRAL CIRCLE 2 (1), BANGALORE RESPONDENT ASSESSEE BY : SHRI ASHOK KULKARNI, ADVOCATE REVENUE BY : SHRI TSHERING ONGDA, JCIT DATE OF HEARING : 10-08-2016 DATE OF PRONOUNCEMENT : 12-08-2016 O R D E R PER SHRI A. K. GARODIA, A.M.: ALL THESE THREE APPEALS ARE FILED BY THE ASSESSEE. SINCE COMMON ISSUES ARE INVOLVED IN ALL THESE APPEALS, ALL THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. IN A.Y. 2003 04, THE GRIEVANCE OF THE ASSESSEE IS ABOUT ADDITION MADE BY THE A.O. OF RS. 15,00,000/- ON ACCOUNT OF G IFT SAID TO HAVE BEEN RECEIVED BY THE ASSESSEE. IN A.Y. 2004 05, THE GR IEVANCE OF THE ASSESSEE IS ABOUT ADDITION MADE BY THE A.O. OF RS. 9,25,000/- O N ACCOUNT OF GIFT SAID TO HAVE BEEN RECEIVED BY THE ASSESSEE. IN A.Y. 2007 08, THE GRIEVANCE OF THE ASSESSEE IS ABOUT ADDITION MADE BY THE A.O. OF RS. 9,00,000/- ON ACCOUNT OF ITA NOS.1265 TO 1267(BANG)2012 2 PROPERTY SALE ADVANCE SAID TO HAVE BEEN RECEIVED BY THE ASSESSEE IN COURSE OF REAL ESTATE BUSINESS OF THE ASSESSEE. 3. IT WAS SUBMITTED BY THE ASSESSEE THAT GIFT DEED OF ONE DONOR IN A. Y. 2003 04 AND AFFIDAVITS OF TWO DONORS IN THA T YEAR ARE AVAILABLE ON PAGES 3 TO 4, 5 AND 7 RESPECTIVELY OF THE PAPER BOO K FOR THAT YEAR AND SIMILARLY FOR A. Y. 2004 05, AFFIDAVITS OF THREE DONORS IN THAT YEAR ARE AVAILABLE ON PAGES 3, 4 AND 6 RESPECTIVELY OF THE P APER BOOK FOR THAT YEAR. AT THIS JUNCTURE, A QUERY WAS RAISED BY THE BENCH A S TO WHETHER, RELATIONSHIP BETWEEN THE DONORS AND THE ASSESSEE DO NNEE IS AVAILABLE ON RECORD AND AS TO WHETHER THE DATE AND OCCASION OF G IFTS AND CREDITWORTHINESS OF THE DONORS IS AVAILABLE ON RECORD, IT WAS SUBMIT TED BY THE LEARNED AR OF THE ASSESSEE THAT THERE IS NO RELATIONSHIP BETWEEN THESE DONORS AND THE ASSESSEE DONNEE AND THERE IS NO OCCASION OF GIFTS A LSO AND FOR CREDITWORTHINESS OF THE DONOR, THE ASSESSEE CANNOT ASK THE PERSON TO PROVIDE EVIDENCE OF HIS CREDIT WORTHINESS. 4. LEARNED DR OF THE REVENUE SUPPORTED THE ORDERS O F THE AUTHORITIES BELOW. 5. I HAVE CONSIDERED RIVAL SUBMISSIONS. THIS IS BY NOW, A SETTLED POSITION OF LAW THAT IN RESPECT OF ACCEPTABILITY OF GIFT, HUMAN PROBABILITY IS VERY IMPORTANT AND IN THE ABSENCE OF ANY RELATIONSH IP AND OCCASION OF GIFT, THE HUMAN PROBABILITY OF RECEIVING SUCH HUGE AMOUNT OF GIFT IS GENERALLY VERY BLEAK. MOREOVER, THIS IS ALSO SETTLED POSITION OF L AW THAT FOR THE SECTION 68, THE ASSESSEE HAS TO ESTABLISH CREDIT WORTHINESS OF THE CREDITOR OR DONOR APART ITA NOS.1265 TO 1267(BANG)2012 3 FROM HIS IDENTITY AND GENUINENESS OF THE TRANSACTIO N. IN THE ABSENCE OF ANY RELATIONSHIP AND OCCASION OF GIFT, GENUINENESS OF T HE TRANSACTION IS NOT BEYOND DOUBT AND NOTHING IS PRODUCED ABOUT CREDIT W ORTHINESS OF THE DONORS. REGARDING THIS CONTENTION THAT HOW THE ASSE SSEE DONNEE CAN ASK THE DONOR TO PROVE HIS CREDIT WORTHINESS, I FEEL THAT O NCE THE A.O. HAS QUESTIONED THE ACCEPTABILITY OF GIFT ON ANY PRETEXT, THE ASSES SEE CAN VERY MUCH ASK THE DONOR, IF HE REALLY EXISTS TO HELP THE ASSESSEE AND ANY PERSON, WHO HAS GIVEN SUCH HUGE GIFT TO THE ASSESSEE, WILL READILY COME F ORWARD TO PROVIDE NECESSARY EVIDENCE ABOUT HIS CREDIT WORTHINESS. THE REFORE, I FEEL THAT NO INTERFERENCE IS CALLED FOR IN THE ORDERS OF THE LEA RNED CIT (A) FOR A.Y. 2003 04 & 2004 05 BECAUSE THE ASSESSEE HAS FAILED TO E STABLISH GENUINENESS OF THE GIFT TRANSACTION AND CREDIT WORTHINESS OF THE S AID DONORS. 6. SIMILARLY, FOR A.Y. 2007 08 ALSO, THE ASSESSEE HAS NOT ESTABLISHED THE CREDIT WORTHINESS OF THE PERSONS FR OM WHOM THE ASSESSEE IS CLAIMING RECEIPT OF ADVANCES. REGARDING THIS CONTE NTION THAT THESE ADVANCES ARE RECEIVED IN COURSE OF REAL ESTATE BUSINESS OF T HE ASSESSEE, THE BENCH POSED A QUERY TO THE LEARNED AR OF THE ASSESSEE AS TO WHEN THE SALE TO THESE PERSONS HAVE TAKEN PLACE AND WHETHER THESE ADVANCES WERE ULTIMATELY TAKEN AS SALE PROCEEDS IN THE PRESENT YEAR OR ANY LATER Y EAR, LEARNED AR OF THE ASSESSEE COULD NOT SHOW THAT THESE AMOUNTS WERE ULT IMATELY TAKEN AS SALE PROCEEDS IN THE PRESENT YEAR OR ANY LATER YEAR. HEN CE, THIS IS NOT RELEVANT THAT THE ASSESSEE IS IN REAL ESTATE BUSINESS AND AS PER THE CLAIM OF THE ASSESSEE, THESE AMOUNTS WERE RECEIVED AS ADVANCE FO R SALE OF REAL ESTATE BECAUSE THE ASSESSEE COULD NOT ESTABLISH THIS THAT THESE AMOUNTS WERE ITA NOS.1265 TO 1267(BANG)2012 4 ACCOUNTED FOR IN THE PRESENT YEAR OR IN ANY LATER Y EAR AS SALE PROCEEDS. HENCE, IN THIS YEAR ALSO, I FIND NO REASON TO INTER FERE IN THE ORDER OF CIT (A). 7. IN THE RESULT, ALL THREE APPEALS OF THE ASSESSE E ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- (A.K. GARODIA) ACCOUNTANT MEMBER PLACE: BANGALORE: D A T E D : 12.08.2016 AM* COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A)-II BANGALORE 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER, AR, ITAT, BANGALORE ITA NOS.1265 TO 1267(BANG)2012 5 1. DATE OF DICTATION .. 2. DATE ON WHICH THE TYPED DRAFT IS PLAC ED BEFORE THE DICTATING MEMBER . 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P. S. .. 4 DATE ON WHICH THE ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT .. 5. DATE ON WHICH THE OR DER COMES BACK TO THE SR. P.S. .. 6. DATE OF UPLOADING THE ORDER ON WEBSITE .. 7. IF NOT UPLOADED, FURNISH THE REASON FOR DOING SO . 8. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 9. DATE ON WHICH ORDER DOES FOR XEROX & ENDORSEMENT . 10. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK. 11 THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER. 12 THE DATE ON WHICH THE FILE GOES TO THE DISPATCH SECTION FOR DISPATCH OF THE TRIBUNAL ORDER 13 DATE OF DISPATCH OF ORDER