SHARAD BAGGA, MUMBAI V. ITO 20(3)(2), MUMBAI

ITA 1734/MUM/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 2679 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 18-11-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 17-03-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANKUR GARG
• Keywords: Gift; Capital Gains

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI. BEFORE SHRI R.V.EASWAR, SENIOR VICE PRESIDENT I.T.A. NO. 1734/MUM/2009 (ASSESSMENT YEAR : 2005-06) SHARAD BAGGA, BUILDING NO.6, GALA NO.9, SANJAY MITTAL INDUSTRIAL ESTATE, A.K.ROAD, ANDHERI(E), MUMBAI-400 059. PAN:ABIPB2288G VS. THE INCOME TAX OFFICER, WARD-20(3)(2), 403, PIRAMAL CHAMBERS, PAREL, MUMBAI-400 012. (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : MR. ANKUR GARG, DR O R D E R THE ASSESSEE WAS ABSENT FOR THE HEARING. I FIND T HAT ON EARLIER OCCASIONS THE ASSESSEE DID NOT APPEAR. I THEREFORE, PROCEED TO DISPOSE OF THE APPEAL ON THE BASIS OF TH E RECORD AND AFTER HEARING THE LEARNED SENIOR D.R. 2. THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME FR OM BUSINESS, SHORT TERM CAPITAL GAINS AND OTHER SOURCE S. IN THE RETURN, HE CLAIMED TO HAVE RECEIVED MARRIAGE GIFTS OF RS.4,48,100/- AS PER LIST. ON VERIFICATION OF THE L IST, THE ASSESSING OFFICER FOUND THAT CASH GIFTS AMOUNTED TO RS.1,49,800/- CONSISTING OF RS.74,800/- AS SHAGUN A ND RS.75,000/- FROM RELATIVES. THE ASSESSING OFFICER P ROPOSED TO ASSESS THE CASH GIFTS AS THE ASSESSEES INCOME UNLE SS CONFIRMATION WAS FILED. SINCE THE ASSESSEE EXPRESSE D HIS INABILITY TO CONFIRM THE SAME, THE AMOUNT OF RS.1,4 9,800/- WAS ADDED AS INCOME FROM OTHER SOURCES. 3. THE ASSESSEE HAD ALSO SHOWN EXPENSES OF RS.75,00 0/- ON HIS MARRIAGE OUT OF DRAWINGS OF RS.79,479/-. THE AS SESSING ITA NO.1734/MUM/09 2 OFFICER PROPOSED TO ESTIMATE THE EXPENSES AT RS.1,5 0,000/- CONSIDERING THE ASSESSEES STATUS , MARRIAGE CUSTOM , TRAVELLING EXPENSES, HIRING OF ROOMS AND VEHICLES ETC. ON THE GROUND THAT THE ASSESSEE COULD NOT OFFER ANY CONVINCING EVIDENC E TO SHOW THAT NO SUCH EXPENSES WERE INCURRED, HE ADDED RS.1, 50,000/- ALSO UNDER THE HEAD INCOME FROM OTHER SOURCES. 4. ON APPEAL, THE CIT(A) DELETED THE ADDITION OF RS .74,800/- BEING SHAGUN RECEIVED BUT SUSTAINED THE ADDITION OF RS.75,000/- BEING CASH GIFTS RECEIVED FROM RELATIVE S. THE ADDITION OF RS.1,50,000/- FOR MARRIAGE EXPENSES WAS CONFIRMED. THE APPEAL WAS THUS PARTLY ALLOWED. 5. THE ASSESSEE IS IN FURTHER APPEAL AGAINST THE AD DITIONS SUSTAINED BY THE CIT(A). I HAVE GONE THROUGH THE FA CTS AS CONTAINED IN THE ORDERS OF THE DEPARTMENTAL AUTHORI TIES AND HEARD THE LEARNED SENIOR D.R. SO FAR AS THE CASH GI FTS OF RS.75,000/- FROM RELATIVES ARE CONCERNED, THE ASSES SEE STATED BEFORE THE CIT(A) THAT THEY WERE RECEIVED FROM THE RELATIVES IN SMALL DENOMINATIONS OF RS.1,000/- TO RS.2,000/-, BU T THIS EXPLANATION WAS REJECTED AS NOT SUPPORTED BY EVIDEN CE. I HOWEVER, CONSIDER THAT IT IS GENERAL CUSTOM OR PRAC TICE FOR RELATIVES TO MAKE CASH GIFTS AND PRESENTS ON THE OC CASION OF THE MARRIAGE AND THERE IS NO REASON TO THINK THAT THE A SSESSEE WOULD NOT HAVE BEEN A BENEFICIARY OF THE PRACTICE. APPARENTLY THE ASSESSEE DID NOT MAINTAIN ANY LIST OF NAMES OF THE RELATIVES AND FRIENDS FROM WHOM HE RECEIVED CASH GIFTS BUT TH AT SHOULD NOT DETER ME FROM MAKING A REASONABLE ESTIMATE OF T HE CASH GIFTS RECEIVED BY THE ASSESSEE CONSIDERING THE SURR OUNDING CIRCUMSTANCES SUCH AS HIS BUSINESS AND CONSIDERING THE AMOUNT OF SHAGUN RECEIVED FROM THE BRIDES FAMILY W HICH HAS BEEN ACCEPTED AT RS.74,800/-. IT SEEMS TO ME REASON ABLE TO HOLD THAT THE ASSESSEE WOULD HAVE RECEIVED AN EQUAL AMOU NT OF CASH ITA NO.1734/MUM/09 3 GIFTS AND PRESENTS FROM HIS FRIENDS AND RELATIVES. I THEREFORE ACCEPT THE ASSESSEES CLAIM THAT HE RECEIVED CASH G IFTS OF RS.75,000/- FROM HIS FRIENDS AND RELATIVES ON HIS M ARRIAGE. I THUS DELETE THE ADDITION OF RS.75,000/-. 6. AS REGARDS THE ADDITION OF RS.1,50,000/- FOR MAR RIAGE EXPENSES, I FIND THAT THE ASSESSEE CANNOT TAKE CRED IT FOR THE DRAWINGS OF RS.79,479/- BECAUSE THIS AMOUNT WOULD H AVE BEEN SUFFICIENT ONLY FOR HIS OTHER LIVING EXPENSES. HOWE VER, THE ESTIMATE OF MARRIAGE EXPENSES AT RS.1,50,000/- SEEM S TO ME TO BE SOMEWHAT HIGH-PITCHED. I REDUCE THE SAME TO RS.7 5,000/- CONSIDERING THE EXPENSES INVOLVED SUCH AS PRINTING OF CARDS, HIRING OF ROOMS AND VEHICLES, COST OF TRAVELLING FO R FAMILY MEMBERS AND RELATIVES ETC. IN THE RESULT, THE APPEA L OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 11 TH DAY OF DECEMBER, 2009. SD/- ( R.V.EASWAR ) SENIOR VICE PRESIDENT MUMBAI, DATED 11 TH DECEMBER, 2009. SOMU COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-20, MUMBAI. 4. THE CIT(A)-XXXII, MUMBAI 5. THE DR SMC BENCH /TRUE COPY/ BY ORDE R ASSTT. REGISTRAR, I.T.A.T, MUMBAI