B.Dhanraj, CHENNAI V. DCIT, CHENNAI

ITA 1355/CHNY/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8292 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 23-11-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 02-06-2015
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: MACHARLA ROSAIAH
• Keywords: Unexplained cash credit; Gift
• Section: 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . . . , . ! , ' # $ [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.1355/MDS/2015 / ASSESSMENT YEAR : 2005-06 SHRI B DHANRAJ B-202, RAHEJA RESIDENCE NO.90, SANTHOME HIGH ROAD R.A PURAM, CHENNAI 600 028 VS. THE DY. COMM ISSIONER OF INCOME-TAX COMPANY CIRCLE II(2) CHENNAI [PAN ADKPD 4130 D ] ( %& / APPELLANT) ( '(%& /RESPONDENT) / APPELLANT BY : SHRI MACHARLA ROSAIAH, CA /RESPONDENT BY : SHRI P RADHAKRISHNAN, J CIT / DATE OF HEARING : 23 - 1 1 - 2015 ! / DATE OF PRONOUNCEMENT : 01 - 01 - 2016 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-6, CHENNA I, DATED 25.2.2015 AND PERTAINS TO ASSESSMENT YEAR 2005-06. 2. SHRI MACHARLA ROSAIAH, LD. REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER MADE AN ADDITI ON OF ` 20,50,000/- AS UNEXPLAINED CREDIT U/S 68 OF THE ACT. ACCORDIN G TO THE LD. ITA NO. 1355/15 :- 2 -: REPRESENTATIVE, THE ASSESSEES MOTHER SOLD A PROPE RTY FOR ` 8 LAKHS WHICH WAS DEPOSITED IN THE BANK ACCOUNT. THE ASSE SSEE HAS ALSO RECEIVED A SUM OF ` 6 LAKHS FROM HIS MOTHER. APART FROM THAT THE ASSESSEE HAS WITHDRAWN A SUM OF ` 4 LAKHS ON 18.1.2005 FROM THE BANK ACCOUNT WHICH WAS ALSO DEPOSITED IN THE BANK. THE LD. REPRESENTATIVE FURTHER CLARIFIED THAT ON 17.8.2004 THE ASSESSEE HAS WITHDRAWN A SUM OF ` 2 LAKHS AND ON 21.2.2005 ANOTHER SUM OF ` 1,69,100/- FROM CANARA BANK ACCOUNT WHICH WAS DEPO SITED IN THE BANK ACCOUNT. THE LD. REPRESENTATIVE FURTHER SUBMI TTED THAT THE ASSESSEES MOTHER SOLD HER PROPERTY ON 13.1.2005 FO R A SUM OF ` 8 LAKHS. THIS WAS NOT CONSIDERED BY THE ASSESSING OF FICER. HOWEVER, THE CIT(A) FOUND THAT THE ASSESSEE HAS EXPLAINED T HE SOURCE TO THE EXTENT OF ` 12,30,000/- AND CONFIRMED THE ADDITION TO THE EXTE NT OF ` 8,20,000/-. THEREFORE, THE ASSESSEE FILED APPEAL BEFORE THIS TRIBUNAL AGAINST THE ORDER OF THE CIT(A) CONFIRMING ADDITION TO THE EXTENT OF ` 8,20,000/-. 3. ACCORDING TO THE LD. COUNSEL, THE SALE PROCEEDS OF PROPERTY SOLD BY THE ASSESSEES MOTHER TO THE EXTENT OF ` 8 LAKHS WAS DEPOSITED IN HIS ACCOUNT. THIS WAS NOT ACCEPTED BY THE CIT(A). ACCORDING TO THE LD. REPRESENTATIVE, SINCE THE SALE IS NOT IN DISPUTE, THE CIT(A) OUGHT TO HAVE ALLOWED THE CLAIM OF THE AS IN RESPECT OF THE AMOUNT RECEIVED FROM HIS MOTHER. ITA NO. 1355/15 :- 3 -: 4. ON THE CONTRARY, SHRI P RADHAKRISHNAN, LD. DEPARTME NTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE CLAIMED BEFORE THE LOWER AUTHORITIES THAT HIS MOTHER SOLD THE PROPERTY ON 13 .1.2005. THE ASSESSEE ALSO CLAIMED TO HAVE RECEIVED A SUM OF ` 6 LAKHS AS GIFT FROM HIS MOTHER ON 19.1.2005. ADMITTEDLY, THE ASSESSEE S MOTHER HAS NO SOURCE OF INCOME THEREFORE, THE GIFT OF ` 6 LAKHS SAID TO BE RECEIVED BY THE ASSESSEE ON 19.1.2005 MAY BE FROM THE SALE PRO CEEDS OF THE PROPERTY WHICH SAID TO BE SOLD ON 13.1.2005. AFTER GIFTING A SUM OF ` 6 LAKHS, WHAT WOULD BE LEFT WITH THE ASSESSEES MOTH ER WOULD BE ONLY ` 2 LAKHS, THEREFORE, THE CIT(A) HAS RIGHTLY FOUND TH AT THE GIFT TO THE EXTENT OF ` 8 LAKHS WHICH WAS SAID TO BE RECEIVED FROM HIS MOT HER OVER AND ABOVE THE GIFT OF ` 6 LAKHS WAS DISALLOWED BY THE CIT(A). AFTER CONSIDERING THE CASH WITHDRAWAL FROM CANARA BANK AN D THE GIFT SAID TO BE RECEIVED BY THE ASSESSEE, THE CIT(A) ACCEPTED THE EXPLANATION OF THE ASSESSEE TO THE EXTENT OF ` 12,30,000/- AND THE BALANCE OF ` 8,20,000/- WAS RIGHTLY CONFIRMED BY THE CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSEE CLAIMS THAT HE RECEIVED A SUM OF ` 8 LAKHS FROM HIS MOTHER AND ALSO A SUM OF ` 6 LAKHS AS GIFT. THE ASSESSEE COULD NOT ESTABLIS H ANY SORUCE OF HIS MOTHER TO GIVE MONEY. HOWEVER, THE CIT(A) ACCEPTED THE CLAIM OF THE ITA NO. 1355/15 :- 4 -: ASSESSEE WITH REGARD TO SALE OF PROPERTY ON 13.1.20 05 FOR A TOTAL CONSIDERATION OF ` 8 LAKHS. OUT OF THIS ` 8 LAKHS THE ASSESSEE WOULD HAVE RECEIVED GIFT OF ` 6 LAKHS FROM HIS MOTHER. ONCE THE ASSESSEES MOTHER GIFTED A SUM OF ` 6 LAKHS SHE MAY NOT HAVE ANY OTHER MONEY TO GIVE TO THE ASSESSEE TO THE EXTENT OF ` 8 LAKHS AS CLAIMED. THEREFORE, THE CIT(A) RESTRICTED THE ADDITION TO TH E EXTENT OF ` 8,20,000/- AFTER ACCEPTING THE EXPLANATION OF THE ASSESSEE TO THE EXTENT OF ` 13,20,000/-. AFTER GIFTING ` 6 LAKHS, THE ASSESSEES MOTHER IS ALSO HAVE ANOTHER ` 2 LAKHS FROM THE SALE PROCEEDS OF THE VERY SAME PROPERTY. THEREFORE, THIS TRIBUNAL IS OF THE CONS IDERED OPINION THAT THE ASSESSEE MIGHT HAVE RECEIVED THIS ` 2 LAKHS FROM HIS MOTHER. THIS BALANCE OF ` 2 LAKHS WAS OMITTED TO BE CONSIDERED BY THE CIT(A) ON THE GROUND THAT THE ASSESSEES MOTHER MIGHT HAVE KEPT THE SAME FOR HER OWN REQUIREMENTS. BUT THE PROBABILITY IS THERE . SHE MIGHT HAVE GIFTED THE MONEY TO THE ASSESSEE ALSO. THEREFORE, IN ALL PROBABILITY, THE EXPLANATION OF THE ASSESSEE TO THE EXTENT OF ` 14,30,000/- HAS TO BE ACCEPTED. NOW WHAT REMAINS TO BE EXPLAINED IS O NLY ` 6,20,000/-. THE ASSESSEE COULD NOT FURNISH ANY EXPLANATION WIT H REGARD TO CASH DEPOSIT OF ` 6,20,000/- IN THE BANK ACCOUNT. IN THE ABSENCE OF ANY EXPLANATION FOR THE SOURCE OF INCOME TO THE EXTENT OF ` 6,20,000/- THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ADDI TION HAS TO BE RESTRICTED ONLY TO THE EXTENT OF ` 6,20,000/-. ACCORDINGLY, THE ORDERS OF ITA NO. 1355/15 :- 5 -: THE LOWER AUTHORITIES ARE MODIFIED AND THE ADDITION TO THE EXTENT OF ` 6,20,000/- IS CONFIRMED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PART LY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 ST JANUARY, 2016, AT CHENNAI. SD/- SD/- ( . ! ) (A. MOHAN ALANKAMONY) ' / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 1 ST JANUARY, 2016 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF