Ashok Kumar Singhaniya, BHILWARA V. ITO, BHILWARA

ITA 172/JODH/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78167 (ITAT-JODHPUR)
• Duration Of Justice: 2 year(s) 1 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 09-05-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 09-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Keywords: Gift; Income from undisclosed sources
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K.SAINI, ACCOUNTANT MEMBER ITA NO. 172/JODH/2012 (A.Y. 2008-09) ASHOK KUMAR SINGHANIYA VS. THE INCOME TAX O FFICER PROP. M/S. RISHABH AGENCIES, WARD(1), 1-D-11, OLD HOUSING BOARD, BHILWARA. SHASTRI NAGAR, BHILWARA PAN NO. AQPPS 3461C (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI P.C. PARWAL. DEPARTMENT BY : SHRI N.A. JOSHI, DR. DATE OF HEARING : 09.05.2014 DATE OF PRONOUNCEMENT : 22.05.2014 ORDER PER HARI OM MARATHA, J.M. THIS APPEAL OF THE ASSESSEE FOR A.Y. 2008-09, IS DIRECTED AGAINST THE ORDER OF LD. CIT(A), AJMER, DA TED 03.01.2012. 2 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEA L :- 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS. 1,45,000/- BY TREATI NG THE GIFT RECEIVED FROM MOTHER AS UNDISCLOSED INCOME U/S 68 OF THE I.T. ACT, 1961. 2. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS. 3 LAKHS BY TREATING THE INVESTMENT AS UNEXPLAINED CASH U/S 68 OF THE I.T. A CT, 1961. 3. THE APPROPRIATE COST BE AWARDED TO THE ASSESSEE. 2.1 WE HAVE HEARD RIVAL SUBMISSIONS AND HAVE CAREFU LLY PERUSED THE ENTIRE RECORD. THE ASSESSEE DERIVED HIS INCOME FROM COMMISSION BY ACTING AGENT FOR THE SALE OF GREY FABRICS AND YARN. DURING THE YEAR THE ASSESSEE HAS SHOWN A GIFT OF RS. 1,45,000/- TO HAVE BEEN RECEIVE D FROM HIS MOTHER SMT. SAVITRI DEVI SINGHANIA. THE A.O. HA S TREATED THIS GIFT AS BOGUS BECAUSE THE GIFT DEED IS WRITTEN ON A PLAIN PAPER AND NOT ON A STAMP PAPER. THE A.O. HAS ALSO DOUBTED HER CAPACITY TO MAKE THIS GIFT WHEN SH E HAD 3 ONLY CASH BALANCE OF RS. 3,175/- ON THE DAY OF MAKI NG THIS GIFT. HENCE, HE HAS ADDED A SUM OF RS. 1,45,000/- T O HIS INCOME OF THE YEAR. IN APPEAL ALSO THIS GIFT HAS BE EN COMPLIED ON THE BASIS OF ALMOST IDENTICAL REASONS. BEFORE US BOTH THE PARTIES HAVE REITERATED THEIR EARLIER ARGUMENTS. THE LD. A.R. HAS ARGUED THAT A GIFT OF R S. 1,45,000/- FROM ASSESSEES MOTHER CANNOT BE DOUBTED . SHE WAS HAVING SAVINGS TO THAT EXTENT AND HAS HELP HER SON BY MAKING SUCH A GIFT. ONLY BECAUSE THE GIFT IS WRITTE N ON A PLAIN PAPER IT CANNOT BE IGNORED ALTOGETHER. ON THE OTHER HAND LD. D.R. HAS SUPPORTED THE ORDERS OF THE AUTHO RITIES BELOW. 2.2 AFTER CONSIDERING RIVAL SUBMISSIONS WE HAVE FOU ND THAT THE MOTHER OF THE ASSESSEE CAN MAKE GIFT OF RS . 1,45,000/- OUT OF HER OWN SAVINGS AND WITHDRAWALS. THERE IS NO SUCH LEGAL REQUIREMENT THAT THE GIFT DEED SHO ULD BE TYPED / WRITTEN ON A STAMPED PAPER ETC. A GIFT BY M OTHER CAN BE MADE AT ANY TIME AND FOR THAT PURPOSE NO SPE CIAL OCCASION IS REQUIRED. THERE IS NO CONTRARY VALID PR OOF ON 4 RECORD WHEREBY THIS GIFT CAN BE DUBBED AS INGENUINE . ACCORDINGLY, WE TREAT THIS GIFT AS GENUINE AND DELE TE THE ADDITION OF RS. 1,45,000/- FROM THE HANDS OF THE AS SESSEE AND ALLOW GROUND NO. (1) OF APPEAL. 3. THE NEXT EFFECTIVE GROUND IS ABOUT CONFIRMATION OF AN ADDITION OF RS. 7,00,000/- BY TREATING THE RECOVERY FROM INVESTMENT AS UNEXPLAINED CASH U/S 68 OF THE ACT. T HE LD. AR HAD GIVEN FULL DETAILS OF THE INVESTMENT TO EXPL AIN THE SUNDRY INVESTMENTS. HE HAS GIVEN OTHER REQUISITE DE TAILS CALLED FOR. DURING THE ASSESSMENT PROCEEDINGS, IT W AS OBSERVED THAT THE ASSESSEE HAD SHOWN CREDIT ENTRIES OF RS. 3 LAKHS IN CASH BOOK ON 19.2.2008 AS SUNDRY INVESTM ENT. THE ASSESSEE WAS ASKED TO EXPLAIN THE SUNDRY INVEST MENT WITH FULL DETAILS OF THE SAME INCLUDING COMPLETE AD DRESS VIDE ORDER-SHEET ENTRY DATED 19.11.2010. THE ASSESS EE SUBMITTED ALL THE REQUISITE INFORMATION ON 30.11.20 10. THE LD. A.R. CAME PRESENT ON 30.11.2011 AND SUBMITT ED ALL REQUISITE DETAILS CALLED FOR ON 19.11.2010 AND THE A.O. HAS NOTED THE FOLLOWING NOTED IN HIS ORDER-SHEET: 5 30.11.2010 - SHRI SANDEEP SINGHVI, CA ATTENDED FURNISHED REPLY IN COMPLIANCE TO ORDER-SHEET ENTRY DATED 19.11.2010. REPLY PLACED ON RECORD. CASE DISCUSSED ON THE ISSUE AS PER THE ORDER- SHEET ENTRY AND QUERIES. THE LD. A.R. WAS ALSO ASKED TO PRODUCE SHRI AKSHAY KUMAR PUNGALIA FROM WHOM 1,75,000/- WAS SHOWN AS ON 31.3.2007 AND SHRI SANJAY KHETAN FROM WHOM RS. 3,93,475/- AS ON 31.3.2007. THUS, TOTAL RECEIPT OF RS. 3 LAKHS DURING THE YEAR AS SUNDRY INVESTMENTS HAS BEEN RECEIVED. AS PER THE A.O., TH E ASSESSEE HAS FAILED TO PROVE THE CASH CREDIT OF RS. 3 LAKHS FROM THE ABOVE TWO PERSONS AS THE ASSESSEE HIMSELF HAD ACCEPTED THAT BOTH THE PERSONS ARE NOT FILING ROI AS ONE IS EMPLOYEE GETTING RS. 3000/- P.M. AND SECOND IS HAVI NG NO REGULAR SOURCE OF HIS INCOME. THUS, THE NATURE AND SOURCE OF RS. 3 LAKHS CREDITED IN THE BOOKS OF ACCOUNT AS ON 19.2.2008 REMAINED AS UNEXPLAINED. THE ASSESSEE HAD CASH BALANCE OF RS. 3 LAKHS AS ON 19.2.2008 OUT OF H IS INCOME FROM UNDISCLOSED SOURCES AND HE HAS DISCLOSE D THIS 6 AMOUNT AS CASH CREDIT. THEREFORE, SAME ENTRY OF RS . 3 LAKHS FROM CASH CREDITORS HAS BEEN TREATED AS UNEXP LAINED AND ADDED IN THE HANDS OF THE ASSESSEE U/S 68 OF TH E ACT. 4. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE HAVE FOUND THAT SHRI SANJAY KHETAN HAS STATED THAT HE IS RELATIVE OF THE ASSESSEE AND PURCHASED FABRIC FROM THE ASSESSEE. DURING BUSINESS THE ASSESSEE PAID AMOUNT TO THE SELLER ON HIS BEHALF BECAUSE THE ASSESSEE WAS COMMI SSION AGENT IN THIS DEAL AND SUBSEQUENTLY, THE ASSESSEE R ECEIVED RS. 3 LAKHS AGAINST THE AMOUNT DUE FROM HIM ON 19.2 .2008 AND REMAINING AMOUNT ON 31.3.2008. THE A.O. AS WEL L AS THE LD. CIT(A) HAVE REJECTED THIS CONTENTION OF THE ASSESSEE FOR LACK OF PROOF REGARDING PROPOSED DEAL OF AGRICULTURAL LAND. AFTER CONSIDERING THE RIVAL SUB MISSIONS WE HAVE NOTICED THAT THIS ISSUE IS VERY DICEY AND T HE CLAIMS SO MADE BY THE ASSESSEE, IF TREATED TO BE TR UE, THEN NO ADDITION HAS TO BE MADE, BUT ON THE OTHER HAND, IF TREATED AS CONCOCTED STORY, THEN NO SUCH RELIEF IS EXIGIBLE TO THE ASSESSEE. BUT WE HAVE FOUND THAT THE ASSESS EE HAS 7 DISCHARGED HIS PRIMARY ONUS CAST ON HIM BY MAKING SUBSTANTIAL ARGUMENTS IN THIS REGARD. HOWEVER, THE REVENUE HAS NOT COME UP WITH EVIDENCE OF PROOF TO T HE CONTRARY WHAT THE ASSESSEE HAS ADDUCED IN HIS EVIDE NCE. ACCORDINGLY, WE ARE SATISFIED THAT THIS AMOUNT CANN OT BE ADDED IN THE HANDS OF THE ASSESSEE. AS A RESULT, W E ALLOW THIS GROUND AND ORDER TO DELETE THE IMPUGNED ADDITI ON. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 22 ND MAY, 2014. SD/- SD/- (N.K.SAINI) [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 22 ND MAY, 2014 VL/- COPY TO: THE APPELLANT THE RESPONDENT THE CIT BY ORDER THE CIT(A) THE DR ASSISTANT REGISTRAR ITAT, JODHPUR