Sri Nandigam Sudhakar, Tanuku V. The ITO, Ward-1., Tanuku

ITA 149/VIZ/2008

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 2631 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 09-12-2010
• Assessment Year: 2001-2002
• Appeal Filed On: 19-02-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: J SIRI KUMAR
• Keywords: Unexplained cash credit; Gift
• Section: 68

Judgement Text

ITA 149/VIZ/2008 NANDIGAM SUDHAKAR, TANUKU IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI BR BASKARAN, ACCOUNTANT MEMBER ITA NO. 149 /VIZAG/ 20 08 ASSESSMENT YEAR : 2004 - 05 NANDIGAM SUDHAKAR TANUKU ITO WARD - 1 TANUKU (APPELLANT) VS. (RESPONDENT) PAN NO. AAQPN6976J APPELLANT BY: SHRI G.V.N. HARI, CA RESPONDENT BY: SHRI J. SIRI KUMAR, DR ORDER PER SHRI S.K. YADAV, JUDICIAL MEMBER : - THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A) ON A SOLITARY GROUND THAT CIT(A) HAS ERRED IN CONFIRMING THE ADDITIONS MADE TOWARDS THE GIFT RECEIVED FROM THE MOTHER BY THE ASSESSEE. 2. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE ORDERS OF AUTHORITIES BELOW. THE F ACTS BORNE OUT FROM THE RECORD ARE THAT THE ASSESSEE CLAIMED TO HAVE RECEIVED A CASH GIFT OF RS.1,50,000/ - FROM HIS MOTHER ON THE EVE OF HIS BIRTHDAY. IN SUPPORT OF HIS CONTENTION, A CONFIRMATION LETTER , EXPLAINING THAT THE AMOUNT WAS SOURCED FROM THE ACC UMULATED SAVINGS OF THE AGRICULTURAL INCOME IN RESPECT OF 4.67 ACRES OF LAND OWNED BY HIS MOTHER WAS FILED . O N REQUIRING THE ASSESSEE TO PRODUCE THE ALLEGED DONOR, THE ASSESSEE EXPRESSED HIS INABILITY TO DO SO , BY STATING THAT HIS MOTHER HAD SINCE EXPIR ED. ANALYSING THAT IF AT ALL THE ALLEGED DONOR HA D EARNED ANY AGRICULTURAL INCOME THAT MIGHT HAVE BEEN JUST ADEQUATE TO MEET HER DOMESTIC EXPENSES , LEAVING HER WITH NO FURTHER FUNDS TO ACCUMULATE OVER THE YEARS AND MAKE A GIFT TO THE ASSESSEE , T HE A.O. RE JECTED THE EXPLANATION OF THE ASSESSEE AND TREATED THIS GIFT AMOUNT AS UNEXPLAINED CASH CREDIT. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) AND REITERATED ITS CONTENTIONS. THE CIT(A) RE - EXAMINED THE ISSUE BUT WAS NOT CONVINCED WITH ITA 149/VIZ/2008 NANDIGAM SUDHAKAR, TANUKU 2 THE EXPLANATION S OF THE ASSESSEE AND HAS CONFIRMED THE ADDITIONS. THE RELEVANT OBSERVATION OF THE CIT(A) IS EXTRACTED HEREUNDER: AFTER HEARING THE LEARNED AUTHORIZED REPRESENTATIVE AND ON A CAREFUL CONSIDERATION OF THE FACTS RELATING TO THE ISSUE, IT MAY BE STATED THA T THE APPELLANT HAS NOT FURNISHED EITHER ANY CONVINCING EXPLANATION OR ANY COGENT AND ACCEPTABLE EVIDENCE IN SUPPORT OF THE CLAIM OF HAVING RECEIVED CASH GIFT FROM HIS LATE MOTHER N. VARALAKSHMI DEVI. DURING THE APPELLATE PROCEEDINGS IN RESPECT OF THE APP EALS FOR THE ASSESSMENT YEARS 2000 - 01 AND 2001 - 02, THE LEARNED AUTHORIZED REPRESENTATIVE HAD CATEGORICALLY STATED THAT THE AGRICULTURAL INCOME RELATING TO THE LAND OWNED BY HIS MOTHER AND THAT, WHATEVER AGRICULTURAL INCOME EARNED IN RESPECT OF 14.16 ACRES OF LAND OWNED BY THE APPELLANT AT VELIVENNU AND KALDHARI VILLAGES OF UNDRAJAVERAM MANDAL, AND AT SETTIPETA VILLAGE OF NIDADAVOLE MANDAL, WERE CONSIDERED AS RELATING TO THE HUF OF THE APPELLANT. SINCE THE MEAGER AGRICULTURAL INCOME OF RS.20,000 PER ANNUM I N RESPECT OF THE LANDS OWNED BY SMT. N. VARALAKSHMI DEVI (AS SHOWN BY THE APPELLANT IN HIS INDIVIDUAL RETURNS IN THE EARLIER YEARS) HAD BEEN APPROPRIATED BY THE APPELLANT AS HIS OWN AGRICULTURAL INCOME, THE QUESTION OF ANY SAVINGS AND ACCUMULATION OF SUCH AGRICULTURAL INCOME IN THE HANDS OF THE LATE MOTHER OF THE APPELLANT SIMPLY DOES NOT ARISE. THE FACTS ON THE ISSUE DISPROVE AND FALSIFY THE CONTENTION OF THE APPELLANT AS WELL AS THE ALLEGED DONOR THAT THE ALLEGED CASH GIFT OF RS.1,50,000 HAD BEEN SOURCED FROM THE ACCUMULATED SAVINGS OF AGRICULTURAL INCOME IN RESPECT OF 4.67 ACRES OF AGRICULTURAL LANDS THEN OWNED BY SMT. N. VARALAKSHMI DEVI. IN THIS VIEW OF THE ANALYSIS OF THE FACTS, IT IS ABUNDANTLY CLEAR THAT THE APPELLANT HAS FAILED TO SUBSTANTIATE T HE GENUINENESS OF THE CASH GIFT OF RS.1,50,000/ - ALLEGEDLY RECEIVED FROM HIS LATE MOTHER. THEREFORE, THE ADDITION OF RS.1,50,000/ - MADE BY THE ASSESSING OFFICER AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT CALLS FOR NO INTERFERENCE. 3. NOW THE ASSESSEE HAS PREFERRED AN APPEAL AND REITERATED ITS CONTENTIONS BUT DURING THE COURSE OF HEARING OF THE APPEAL, HE COULD NOT ESTABLISH THE SOURCE OF GIFT. IT WAS SIMPLY EXPLAINED THAT THIS AMOUNT WAS ACC UMULATED OVER THE YEARS OUT OF H ER SAVINGS AND AGRICULTURAL I NCOME. BUT IN SUPPORT OF THESE CONTENTIONS, NO DOCUMENTARY EVIDENCE WAS PLACED. 4. THE LD. D.R. ON THE OTHER HAND HAS PLACED A RELIANCE UPON THE ORDER OF THE CIT(A). ITA 149/VIZ/2008 NANDIGAM SUDHAKAR, TANUKU 3 5. HAVING GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND FROM PERUSAL O F RECORDS, WE FIND THAT ASSESSEE HAS INTRODUCED RS.1,50,000/ - IN CASH IN ITS BOOKS OF ACCOUNTS AS GIFT RECEIVED FROM HIS MOTHER. BUT DURING THE COURSE OF ASSESSMENT AND THE APPEAL PROCEEDINGS, ASSESSEE COULD NOT EXPLAIN AS TO HOW THIS HUGE AMOUNT WAS KEPT AT HOME BY HER MOTHER AND AS TO HOW IT WAS ACCUMULATED OVER THE YEARS. SINCE NO DOCUMENTARY EVIDENCE WAS PLACED BEFORE US TO PROVE THE GENUINENESS OF THE GIFT, WE ARE NOT ABLE TO ACCEPT THE CONTENTION OF THE ASSESSEE. WE HOWEVER, CAREFULLY EXAMINED THE ORDER OF THE CIT(A) AND WE FIND THAT HE HAS RIGHTLY ADJUDICATED THE ISSUE, THEREFORE, NO INTERFERENCE IS CALLED THEREIN. ACCORDINGLY, WE CONFIRM HIS ORDER. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 10.1 2 .20 10 SD/ - SD/ - (BR BASKARAN) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER VG/SPS VISAKHAPATNAM, DATED 10 TH DECEMBER , 20 10 COPY TO 1 I.S.B. SANKAR, AUDITOR D.NO.35 - 3 - 2/1, NEAR HEAD POST OFFICE, RAILWAY STATION ROAD, TANUKU - 534 211. 2 ITO WARD - 1, TANUKU 3 THE CI T, RAJAHMUNDRY 4 THE CIT (A) , RAJAHMUNDRY 5 THE DR, ITAT, VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM