ACIT, CHENNAI V. PSM Ahmed Abdul Kadir, CHENNAI

ITA 1443/CHNY/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68870 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-12-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 05-11-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 27-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Keywords: Gift; Deemed dividend
• Section: 143(3)

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL A BENCH, CHENNAI. BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI V. DURGA RAO, JUDICIAL MEMBER ITA NO. 1443/MDS/2013 ASSESSMENT YEAR: 2006-07 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE XV, CHENNAI 600 034. VS. SHRI PSM AHMED ABDUL KADIR, NO. 16/14, KRISHNA IYER STREET, NUNGAMBAKKAM, CHENNAI 600 034. [PAN : AAFPA3135R] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N. MADHAVAN, JCIT RESPONDENT BY : NONE DATE OF HEARING : 0 5 . 1 1 .2013 DATE OF PRONOUNCEMENT : 06.12.2013 O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) XII, CHENNAI D ATED 14.03.2013 RELEVANT TO THE ASSESSMENT YEAR 2006-07. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL, FILED HIS RETURN DECLARING TOTAL INCOME OF ` .17,79,850/- FOR THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT AND ASSESSED T OTAL INCOME OF THE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 2 ASSESSEE AT ` .43,80,563/- BY MAKING ADDITION OF ` .26,00,712/- ON ACCOUNT OF DEEMED DIVIDENDS UNDER SECTION 2(22)(E) OF THE ACT. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, TH E ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE IS THE MANAGING DIRE CTOR OF THE COMPANY M/S. ASIA BUILDERS (INDIA) PVT. LTD., WHERE HE IS A BENEFICIAL OWNER OF SHARES AND HOLDS MORE THAN TEN PERCENT OF THE VOTING POWER THEREIN. DURING THE FINANCIAL YEAR 2005-06, THE ASSESSEE RECEIVED FROM THE COMPANY AN AMOUNT OF ` .60 LAKHS. FROM THE BALANCE SHEET OF THE COMPANY, M /S ASIA BUILDERS (INDIA) PVT. LTD., THE ASSESSING OFFICER NOTICED TH AT THE COMPANY HAS ACCUMULATED PROFITS TO THE EXTENT OF ` .26,00,712/- AS ON 31.03.2006. HENCE THE ASSESSING OFFICER TREATED THE ABOVE AMOUNT OF ` .60,00,000/- RECEIVED BY WAY OF ADVANCE/LOAN AS DEEMED DIVIDEND UNDER SECTIO N 2(22)(E) OF THE IT ACT. ACCORDINGLY, THE ASSESSING OFFICER CONSIDERED THE ABOVE AMOUNT OF ` .60,00,000/- AS DEEMED DIVIDENDS U/S.2(22)(E) OF TH E ACT AND BROUGHT TO TAX. HOWEVER, THE ASSESSING OFFICER RESTRICTED THE ADDITION U/S.2(22)(E) OF THE ACT TO ` .26,00,712/-, BEING THE ACCUMULATED PROFITS IN THE HANDS OF THE COMPANY AS ON 1.03.2006. 4. ON APPEAL, IT WAS SUBMITTED BEFORE THE LD. CIT( APPEALS) THAT THE ASSESSEE RECEIVED A GIFT OF ` .59,00,000/- FROM HIS WIFE DURING THE FINANCIAL YEAR 2005-06. IT WAS ALSO SUBMITTED THAT THE ASSESSEES WIFE IS DIRECTOR OF THE M/S. ASIA BUILDERS INDIA PV T. LTD. THE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 3 COMPANY OWED TO MRS. AYASHATH HABEEBA, WIFE OF THE ASSESSEE OF RS.1,22,52,075/- DURING THE YEAR, OUT OF WHICH AN A MOUNT OF RS.59,00,000/- WAS PAID TO HER HUSBAND (ASSESSEE). IT WAS FURTHER SUBMITTED BEFORE THE LD. CIT(APPEALS) THAT THE ABOV E DISPUTED AMOUNT WAS A GIFT GIVEN BY HIS WIFE TO THE ASSESSEE THROUGH COMPANY AND NOT A DEEMED DIVIDEND UNDER SECTION 2(2 2)(E) OF THE ACT. THE ASSESSEES WIFE ALSO DECLARED IN HER RETUR N THE AMOUNT PAID AS A GIFT. IN THE TAX COMPUTATION ALSO, THE AS SESSEE HAD SHOWN BY WAY OF NOTE. SIMILAR NOTE WAS MENTIONED IN ASSESSEES COMPUTATION ALSO. THE LD. CIT(APPEALS), AFTER CONSI DERING THE SUBMISSIONS OF THE ASSESSEE, DELETED THE ADDITION M ADE BY THE ASSESSING OFFICER. THE RELEVANT PORTION OF THE ORDE R IS EXTRACTED HEREUNDER: I HAVE CONSIDERED THE ASSESSEE'S SUBMISSIONS AND P ERUSED THE ASSESSMENT ORDER AND THE RECORDS. AS PER THE CLAIM OF THE ASSESSEE BEFORE THE ASSESSING OFFICER, HE RECEIVED A GIFT OF RS.59,00,000/- FROM HIS WIFE (MRS. MKS AYASHATH HABEEBA), ON 14.03.2006 VID E CHEQUE NO.057265 DRAWN ON SOUTH INDIAN BANK, TRIPLICANE BR ANCH. THE ASSESSEE FURTHER EXPLAINED THAT THE AMOUNT WAS GIVE N BY HIS WIFE OUT OF HER CREDIT BALANCE WITH M/S. ASIA BUILDERS (INDIA) PVT. LTD., A COMPANY IN WHICH SHE (MRS. MKS AYASHATH HABEEBA) IS THE DIRECT OR. THUS, APPARENTLY, THE AMOUNT HAS BEEN PAID FROM THE COMPA NYS BANK ACCOUNT, ON BEHALF OF MRS. AYASHATH HABEEBA OUT OF HER CREDI T BALANCE LYING WITH THE COMPANY. AS PER THE DETAILS CONTAINED IN THE ASSESSMENT ORDE R, THE ASSESSEE RECEIVED AN AMOUNT OF RS.60,00,000/- ON 14.03.2006 BY CHEQUE NO.057265 DRAWN ON SOUTH INDIAN BANK LIMITED, TRIPL ICANE BRANCH, CHENNAI, FROM THE O.D. GENERAL ACCOUNT NO.011208100 0001220. AS PER THE INFORMATION OBTAINED FROM THE BANK, THIS ACCOUN T IS A JOINT ACCOUNT I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 4 IN THE NAMES OF SHRI PSM AHMED ABDUL KADIR AND SHRI ABOOBACKER AJWAD AND NATURE OF THE ACCOUNT IS INDIVIDUAL ACCOU NT. THE ASSESSING OFFICER ALSO NOTICED THAT THE ABOVE CHEQUE NO.05726 5, THROUGH WHICH THE ASSESSEE RECEIVED A SUM OF RS.60,00,000/-, DOES NOT CONTAIN THE SIGNATURE OF MRS. MKS AYASHATH HABEEBA. FURTHER, BOTH THE ASS ESSEE AS WELL AS MRS. AYASHATH HABEEBA HAVE CLAIMED THAT THE GIFT AM OUNT IS ONLY RS.59,00,000/-, WHEREAS THE AMOUNT ACTUALLY RECEIVE D BY THE ASSESSEE THROUGH THE ABOVE MENTIONED CHEQUE NO. IS RS.60,00, 000/-, FOR WHICH THE ASSESSEE HAS NO EXPLANATION. THE ASSESSING OFFICER IN HIS ORDER ALSO NOTICED THA T THE ABOVE MENTIONED CHEQUE NO.057265 OF RS.60,00,000/- WAS FI RST DEPOSITED IN THE ASSESSEE'S BANK ACCOUNT (NO.1378072) IN ABN AMRO BA NK. FROM THIS ACCOUNT, THE ASSESSEE TRANSFERRED AN AMOUNT OF RS.5 9,00,000/- TO ANOTHER BANK ACCOUNT OF HIS WITH AMERICAN EXPRESS BANK (NO. 66389). AS PER THE EXPLANATION OF THE ASSESSEE BEFORE THE A SSESSING OFFICER, THOUGH THE ABOVE BANK ACCOUNT (NO.01120810 00001220) IN SOUTH INDIAN BANK LIMITED IS STANDING IN THE JOINT NAMES OF SHRI PSM AHMED ABDUL KADIR AND SHRI ABOOBACKER AJWAD, THE SA ID ACCOUNT IS BEING USED BY THE COMPANY (M/S. ASIA BUILDERS INDIA PVT. LTD.). AS PER THE ASSESSEE, THIS ACCOUNT IS MERGED WITH THE BOOKS OF THE COMPANY. IN FACT, THE ASSESSING OFFICER VERIFIED THE BOOKS OF A CCOUNT OF THE COMPANY AND FOUND THAT THIS BANK ACCOUNT IS REFLECTED AS TH E BANK ACCOUNT OF THE COMPANY IN ITS BOOKS. THUS, THE ASSESSING OFFICER O PINED THAT A SUM OF RS.60,001000/- HAS BEEN PAID TO THE ASSESSEE FROM T HE COMPANY'S BANK ACCOUNT MAINTAINED WITH SOUTH INDIAN BANK LIMITED. HOWEVER, THE COMPANY IN ITS BOOKS OF ACCOUNT, HAS DEBITED ONLY R S.59,00,000/- TO THE ACCOUNT OF MRS. MKS AYASHATH HABEEBA, AS AGAINST RS .60,00,000/- ACTUALLY PAID TO THE ASSESSEE. THE ASSESSEE VIDE HI S LETTER DATED 19.11.2008, BEFORE THE ASSESSING OFFICER, EXPLAINED THE DIFFERENCE WAS A MISTAKE COMMITTED BY THE COMPANY'S CLERK. HOWEVER, THE ASSESSING OFFICER HAS NOT ACCEPTED THE SAID EXPLANATION OF TH E ASSESSEE. THE ASSESSING OFFICER FURTHER NOTICED THAT IN THE ASSES SEE'S BANK ACCOUNT WITH ABN AMRO BANK THE BALANCE OF RS.L,00,000/- (I.E. TO TAL AMOUNT OF RS.60,00,000 CREDITED MINUS RS.59,00,000 TRANSFERRE D TO THE ASSESSEES AMERICAN EXPRESS BANK ACCOUNT) REMAINED IN THE SAME ACCOUNT TILL 31.03.2006. HENCE, THE ASSESSING OFFICER DISBELIEVE D THAT IT IS A CLERICAL MISTAKE AND HENCE, REJECTED ALL THE EXPLANATIONS OF THE ASSESSEE. THUS, THE ASSESSING OFFICER CAME TO A CONCLUSION TH AT THE ASSESSEE'S CLAIM OF RECEIPT OF GIFT OF RS.59,00,000 /- FROM HIS WIFE, MRS. AYASHATH HABEEBA, IS NOT GENUINE. ON THE OTHER HAND , THE ASSESSEE IS IN I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 5 RECEIPT OF RS.60,00,000/- FROM THE COMPANY, M/S. AS IA BUILDERS INDIA PVT. LTD. IN WHICH HE IS THE MANAGING DIRECTOR AND HAS VOTING RIGHTS OF MORE THAN 10%. FURTHER, THE COMPANY AS ON 31.03.200 6 HAS ACCUMULATED PROFITS OF RS.26,00,712/-. THEREFORE, T HE ASSESSING OFFICER TREATED THE SAID AMOUNT OF RS.60,00,000/- AS DEEMED DIVIDEND U/S.2(22)(E) OF THE ACT, BUT RESTRICTED TO THE ACCU MULATED PROFITS OF RS.26,00,712/-, AND BROUGHT TO TAX. EVEN FROM THE ABOVE FINDINGS OF THE ASSESSING OFFIC ER, THE FOLLOWING FACTS ARE CLEAR: (I) THE ASSESSEE IS IN RECEIPT OF RS.60,00,000/- B Y CHEQUE NO.057265 DRAWN ON SOUTH INDIAN BANK LIMITED (ACCOUNT NO.01L2081000001220). (II) THOUGH THE SAID BANK ACCOUNT, FROM WHICH THE CHEQUE IS DRAWN, IS STANDING IN THE JOINT NAMES OF THE ASSESSEE (SHR I PSM AHMED ABDUL KADIR) AND SHRI ABOOBACKER AJWAD, IT IS MERGE D WITH THE BOOKS OF M/S. ASIA BUILDERS INDIA PVT. LTD. AND WAS BEING USED BY THE SAID COMPANY. THUS, FOR ALL PRACTICAL PURPOSES, THIS IS THE BANK ACCOUNT OF THE COMPANY. (III) MRS. AYASHATH HABEEBA (ASSESSEE'S WIFE) IS A LSO ANOTHER DIRECTOR IN M/S. ASIA BUILDERS INDIA PVT. LTD. AND WAS HAVIN G SUFFICIENT CREDIT BALANCE TO HER ACCOUNT WITH THE COMPANY. THE TOTAL AMOUNTS THE COMPANY OWED TO MRS. AYASHATH HABEEBA ( BEFORE MAKING THE PAYMENT OF RS.59,00,000/- TO THE ASSESSE E) WAS RS.1,22,52,075/- DURING THE YEAR. OUT OF WHICH, A S UM OF RS.59,00,000/- WAS SHOWN AS DRAWINGS IN THE BOOKS O F THE COMPANY ON ACCOUNT OF PAYMENT TO THE ASSESSEE, LEAV ING A CLOSING CREDIT BALANCE OF RS.63,52,075/- AS ON 31.03.2006 . (IV) THUS, ON PAYMENT OF RS.60,00,000/- TO THE ASS ESSEE, THE COMPANY HAS DEBITED AN AMOUNT OF RS.59,00,000/- TO THE ACCO UNT OF MRS. AYASHATH HABEEBA ON 14.03.2006 (BY SHOWING AS HER D RAWINGS). IN OTHER WORDS, IN THE BOOKS OF THE COMPANY, THE AM OUNT IS SHOWN AS PAYMENT ON BEHALF OF MRS. AYASHATH HABEEBA ON 14 .03.2006. (V) THE ASSESSEE, IN HIS RETURN OF INCOME, MENTION ED THAT THE AMOUNT OF RS.59,00,000/- RECEIVED IS A GIFT FROM HIS WIFE, MRS. AYASHATH HABEEBA. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 6 (VI) SIMILARLY, THE ASSESSEE'S WIFE, MRS. AYASHATH HABEEBA, IN HER RETURN OF INCOME FILED FOR A.Y. 2006-07 (FILED ON 1 5.12.2006), ALSO CLEARLY MENTIONED THAT SHE HAD GIFTED AN AMOUNT OF RS.59,00,000/- TO THE ASSESSEE, VIDE NOTE NO.3, WHICH IS AS UNDER: (3) I HAVE GIFTED RS.5900000/ - TO MY HUSBAND, MR. PSM AHMED ABDUL KADIR (PA NO.AAFPA3135R OF BUSINESS RANGE-XV) AND THE SAME IS DEBITED TO MY ACCOUNT WITH M/S. ASIA BU ILDERS (INDIA) PVT. LTD. FROM THE ABOVE, IT IS AN UNDISPUTABLE FACT THAT THE ' ASSESSEE HAS RECEIVED A SUM OF RS.60,00,000/- FROM THE COMPANY I N MARCH, 2006. IN THE BOOKS OF ACCOUNT OF THE COMPANY, M/S. ASIA BUIL DERS INDIA PVT. LTD., THE AMOUNT IS SHOWN AS PAID ON BEHALF OF MRS. AYASH ATH HABEEBA OUT OF THE CREDIT BALANCE LYING IN HER ACCOUNT AND IN FACT , DEBITED THE SAME TO HER ACCOUNT WITH THE NARRATION 'DRAWINGS' ON 14.03. 2006 (THE ACTUAL AMOUNT DEBITED IS RS.59,00,000/-). MRS. AYASHATH HA BEEBA ALSO ACKNOWLEDGED AND CONFIRMED THE PAYMENT OF RS.59,00, 000/- AS GIFT TO HER HUSBAND (THE ASSESSEE), GIVEN FROM THE AMOUNT DUE T O HER FROM THE COMPANY. IN FACT, MRS. AYASHATH HABEEBA REFLECTED T HESE FACTS IN HER RETURN OF INCOME FILED FOR A.Y. 2006-07 ON 15.12.20 06, WHICH WAS MUCH MORE PRIOR TO THE DATE OF INITIATION OF THE ASSESSM ENT PROCEEDINGS IN THE HANDS OF THE ASSESSEE. HENCE, THE SAME CANNOT BE TR EATED AS AN AFTERTHOUGHT OR A COVER-UP STORY. THESE FACTS CLEARLY GOES TO ESTABLISH THAT THE PAYM ENT TO THE EXTENT OF RS.59,00,000/- BY THE COMPANY TO THE ASSESSEE IS ONLY ON BEHALF OF MRS. AYASHATH HABEEBA (ONE OF THE DIRECTORS OF THE COMPANY), THAT TOO, OUT OF HER CREDIT BALANCE LYING WITH THE COMPANY. F URTHER, THE COMPANY IMMEDIATELY AFTER MAKING THE PAYMENT TO THE ASSESSE E, HAS DEBITED THE SAME TO THE ACCOUNT OF MRS. AYASHATH HABEEBA AND RE DUCED FROM THE AMOUNTS DUE TO HER. UNDER THESE CIRCUMSTANCES, THE ABOVE AMOUNT OF RS.5 9,00,000/- CANNOT BE TREATED AS AN ADVANCE OR LOAN FROM THE CO MPANY TO THE ASSESSEE. IT IS ONLY A GIFT RECEIVED FROM MRS. AYAS HATH HABEEBA, THROUGH THE COMPANY ON HER INSTRUCTIONS, THAT TOO, FROM HER CREDIT BALANCES LYING WITH THE COMPANY. THEREFORE, THE PROVISIONS OF SEC. 2(22)(E) OF THE ACT ARE NOT APPLICABLE TO THE FACTS OF THE CASE, TO THE EXT ENT OF THE GIFT SO RECEIVED. AT THE SAME TIME, IT IS ALSO IMPORTANT TO MENTION H ERE THAT THE INTENTION AND INSTRUCTION OF MRS. AYASHATH HABEEBA WAS TO GIFT ONLY I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 7 RS.59,00,000/- TO THE ASSESSEE. ACCORDINGLY, SHE HA S CONFIRMED THE GIFT OF RS.59,00,000/- IN HER RETURN AS WELL AS IN HER SUBS EQUENT CONFIRMATION LETTERS. HOWEVER, THE COMPANY, M/S. ASIA BUILDERS I NDIA PVT. LTD. HAS ADVANCED A SUM OF RS.60,00,000/- TO THE ASSESSEE AS AGAINST THE REQUIRED PAYMENT OF RS.59,00,000/- ON BEHALF OF MRS. AYASHAT H HABEEBA. THEREFORE, THERE IS AN EXCESS PAYMENT OF RS.L,00,00 0/- BY THE COMPANY TO THE ASSESSEE, FOR WHICH THERE IS NO EXPLANATION EIT HER FROM THE ASSESSEE OR FROM THE COMPANY TILL DATE. THIS DIFFERENCE OF R S.L,00,000/- (RS.60,00,000 - RS.59,00,000) IS AN ADVANCE BY THE COMPANY TO THE ASSESSEE AND WAS ALSO OUTSTANDING AS ON 31.03.2006. THEREFORE, THIS AMOUNT OF RS.L,00,000/-, WHICH IS NOT ON BEHALF OF MRS. AYASHATH HABEEBA, CAN BE CONSIDERED AS A DEEMED DIVIDEND WIT HIN THE PROVISIONS OF SEC.2(22)(E) OF THE ACT. THE ASSESSING OFFICER'S ACTION OF TREATING THE DEEMED DIVIDEND TO THE EXTENT OF RS.L,00,000/- IS J USTIFIED AND CONFIRMED. THE BALANCE OF DEEMED DIVIDENDS OF RS.25,00,712/- ( I.E. RS.26,00,712 - RS.L,00,000) IS DELETED. 5. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 6. THE LD. DR STRONGLY SUPPORTED THE ORDER PASSED BY THE ASSESSING OFFICER. 7. WE HAVE HEARD THE LD. DR, PERUSED MATERIALS ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. THE A SSESSEE IS A MANAGING DIRECTOR OF COMPANY M/S. ASIA BUILDERS (IN DIA) PVT. LTD, WHEREIN HE IS A BENEFICIAL OWNER OF SHARES AND HOLD S MORE THAN TEN PERCENT OF THE VOTING POWER THEREIN. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS RECEIVED FROM THE C OMPANY AN AMOUNT OF ` .60 LAKHS. THE ASSESSING OFFICER HAS NOTICED FROM T HE BALANCE SHEET OF THE COMPANY THAT THE COMPANY HAS A CCUMULATED THE PROFITS TO THE EXTENT OF ` .26,00,712/- AS ON 31.03.2006. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 8 THEREFORE, THE ASSESSING OFFICER HAS TREATED THE AB OVE AMOUNT RECEIVED BY THE ASSESSEE AS A DEEMED DIVIDEND. THE CASE OF THE ASSESSEE IS THAT HE HAS RECEIVED A GIFT OF ` .59 LAKHS FROM HIS WIFE MRS. MKS AYASHATH HABEEBA ON 14.03.2006 VIDE CHEQUE NO. 057265 DRAWN ON SOUTH INDIAN BANK, TRIPLICANE BRANC H. IT WAS SUBMITTED THAT THE ASSESSEE HAD EXPLAINED BEFORE TH E ASSESSING OFFICER THAT ASSESSEES WIFE WAS HAVING A CREDIT BA LANCE WITH M/S. ASIA BUILDERS (INDIA) PVT. LTD, THE COMPANY [IN WHI CH SHE MRS. MKS AYASHATH HABEEBA IS DIRECTOR] AND THAT THE AMOU NT HAD BEEN PAID FROM THE COMPANY BANK ACCOUNT ON BEHALF O F MRS. AYASHATH HABEEBA OUT OF CREDIT BALANCE LYING WITH T HE COMPANY. THIS FACT WAS NOT DISPUTED BY THE DEPARTMENT. THE A SSESSEE FILED CONFIRMATION AND IDENTITY OF THE PARTY AND CREDITWO RTHINESS OF THE PARTY, BECAUSE THIS BEING A CHEQUE AMOUNT RECEIVED FROM A COMPANY WHERE DONOR WAS A DIRECTOR. THE GIFT GIVEN TO THE ASSESSEE WAS SHOWN IN THEIR RESPECTIVE RETURN OF IN COME BY THE DONOR AS WELL AS THE ASSESSEE. KEEPING IN VIEW OF T HESE FACTS AND CIRCUMSTANCES OF THE CASE, SECTION 2(22)(E) OF THE ACT HAS NO APPLICATION IN THIS CASE. WE FIND NO INFIRMITY IN T HE ORDER OF THE LD. CIT(APPEALS). ACCORDINGLY, THE APPEAL FILED BY THE REVENUE IS DISMISSED. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1443 1443 1443 1443/M/ /M/ /M/ /M/13 1313 13 9 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON FRIDAY, THE 6 TH OF DECEMBER, 2013 AT CHENNAI. SD/- SD/- (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER (V. DURGA RAO) JUDICIAL MEMBER CHENNAI, DATED, THE 06.12.2013 VM/- TO: THE ASSESSEE/A.O./CIT(A)/CIT/D.R.