SONIA SAHNI, Solan V. ACIT, Chandigarh

ITA 183/CHANDI/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0057 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 02-11-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 20-02-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGHDR
• Assessee Lawyers: SUMIT GOYAL
• Keywords: Gift
• Section: 153A; 68; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 183/CHD/2014 ASSESSMENT YEAR: 2006-07 SMT. SONIA SAHNI, VS THE ACIT, SAHNIS AASHIANA, CENTRAL CIRCLE-II CIRCULAR ROAD, CHANDIGARH. SOLAN. PAN: AAAA5718P (APPELLANT) (RESPONDENT) APPELLANT BY : S/SHRI RAJ KUMAR & SUMIT GOYAL RESPONDENT BY : SHRI MANJIT SINGH,DR DATE OF HEARING : 27.04.2016 DATE OF PRONOUNCEMENT : 28.04.2016 O R D E R PER BHAVNESH SAINI,JM THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) CENTRAL, GURGAON DATE D 24.01.2014 FOR ASSESSMENT YEAR 2006-07. 2. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECOR D. 3. THE LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS G ROUND NO. 1 OF THE APPEAL. SAME IS, THEREFORE, DISMISSED BEING NOT PRESSED. 2 4. ON GROUND NO. 2, ASSESSEE CHALLENGED ADDITION OF RS. 1 LAC ON ACCOUNT OF UNEXPLAINED GIFT. 5. BRIEFLY THE FACTS OF THE CASE ARE THAT SEARCH OPERATION UNDER SECTION 132(1) OF THE INCOME TAX AC T WAS CARRIED OUT AT THE RESIDENTIAL/BUSINESS PREMISES OF SAHNI GROUP OF CASES INCLUDING THE ASSESSEE BY THE REVENU E DEPARTMENT. THE ASSESSEE FILED RETURN OF INCOME UN DER SECTION 139 OF THE INCOME TAX ACT DECLARING TOTAL I NCOME OF RS. 2,84,686/- AND IN REPLY TO THE NOTICE UNDER SECTION 153A OF THE INCOME TAX ACT AS WELL, ASSESSEE DECLAR ED TOTAL INCOME OF RS. 2,84,686/-. THE ASSESSING OFFI CER FOUND THAT ASSESSEE HAS RECEIVED GIFT OF RS. 1 LAC FROM SHRI ASHOK SURI IN ASSESSMENT YEAR UNDER APPEAL. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH DET AILS OF GIFT, NAMES OF THE DONOR, COMPLETE ADDRESS OF THE D ONOR, OCCASION ON WHICH GIFT WAS RECEIVED AND RELATIONSHI P WITH THE DONORS. THE ASSESSEE FILED CONFIRMATION FROM T HE SAID DONOR IN WHICH IT WAS MENTIONED THAT UNSECURED LOAN GIVEN TO THE ASSESSEE HAS BEEN CONVERTED INTO GIFT. IN THE SAID CONFIRMATION, THE DATE WHEN UNSECURED LOAN WAS GIVEN, MODE OF GIVING LOAN AND RELATIONSHIP OF THE DONOR WITH THE ASSESSEE WERE NOT MENTIONED. THE ASSESSING OFFICER NOTED THAT SINCE THE DATE WHEN THE UNSECURE D LOAN WAS GIVEN, MODE OF GIVING LOAN AND OCCASION ON WHIC H LOAN WAS CONVERTED INTO GIFT, HAVE NOT BEEN PROVIDED AND NO FURTHER EVIDENCE OF GIFT HAVE BEEN GIVEN, ASSESSING OFFICER TREATED GIFT TO BE UNEXPLAINED AND ADDITION UNDER S ECTION 3 68 OF THE ACT WAS MADE TREATING THE SAID GIFT TO BE UNSECURED CASH CREDIT UNDER SECTION 68 OF THE ACT. 6. THE ASSESSEE SUBMITTED BEFORE LD. CIT(APPEALS) T HAT SHRI ASHOK SURI, DONOR IS MATERNAL UNCLE OF THE ASS ESSEE AND COMES WITHIN THE DEFINITION OF RELATIVE. HE HAS GIVEN GIFT OF RS. 1 LAC TO THE ASSESSEE VIDE CHEQUE NO. 8 53210 DATED 21.10.2005 DRAWN ON STATE BANK OF INDIA, SOLA N. CONFIRMATION OF SHRI ASHOK SURI, HIS AFFIDAVIT, PAN CARD OF SHRI ASHOK SURI AND BANK STATEMENT OF ASSESSEE HAVE BEEN FILED. 7. THE LD. CIT(APPEALS) FOUND FROM CONFIRMATION AND AFFIDAVIT FILED BY THE ASSESSEE THAT SUM WAS GIVEN ON 31.03.2006 BY CONVERTING UNSECURED LOANS GIVEN EARL IER, IS NOT ACCEPTABLE. THESE DOCUMENTS ARE NOT SUPPORTED BY COPY OF THE BANK STATEMENT OF THE DONOR. IT HAS AL SO NOT BEEN EXPLAINED WHY THE LOAN ADVANCED IN OCTOBER, 20 05 CONVERTED INTO GIFT. HENCE, IN THE ABSENCE OF PROV ING THE CREDIT WORTHINESS OF THE DONOR, CLAIM OF THE ASSESS EE WAS NOT ACCEPTED AND APPEAL OF THE ASSESSEE WAS DISMISS ED. 8. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PARTIES. THE ASSESSEE CLAIMED TO HAVE RECEIVED GIF T OF RS. 1 LAC FROM SHRI ASHOK SURI. THE ASSESSEE FILED CONFIRMATION OF SHRI ASHOK SURI ONLY. IT WAS STATE D THAT RS. 1 LAC HAVE BEEN GIVEN ON 31.03.2006 TO THE ASSE SSEE AS GIFT. IT WAS ALSO MENTIONED THAT UNSECURED LOAN GI VEN TO THE ASSESSEE HAS BEEN CONVERTED INTO GIFT. THE DAT E WHEN 4 UNSECURED LOAN WAS GIVEN, MODE OF GIVING LOAN AND RELATIONSHIP OF THE DONOR WITH THE ASSESSEE WERE NO T MENTIONED IN THE CONFIRMATION. IN THE AFFIDAVIT, S HRI ASHOK SURI, FOR THE FIRST TIME EXPLAINED THAT HE IS MATERNAL UNCLE OF THE ASSESSEE AND GIVEN GIFT THROU GH CHEQUE NO. 853210 DATED 21.10.2005. THEREFORE, THE RE IS A CONTRADICTION IN THE CONFIRMATION OF THE DONOR AN D HIS AFFIDAVIT BECAUSE EARLIER IT WAS CLAIMED THAT GIFT WAS GIVEN ON 31.03.2006 WHICH HAVE BEEN CONVERTED OUT OF LOAN . THE ASSESSEE HAS NOT FILED ANY EVIDENCE ON RECORD TO PR OVE THE CREDIT WORTHINESS OF THE DONOR SHRI ASHOK SURI BEFO RE AUTHORITIES BELOW AND EVEN NOTHING IS FILED BEFORE US TO PROVE CREDIT WORTHINESS OF THE ALLEGED DONOR. 8(I) THE GIFT IS A VOLUNTARY ACT, BY A PERSON WHO, OUT OF LOVE AND AFFECTION TRANSFERS MONEY OR MOVABLE OR IMMOVABLE ASSET TO ANOTHER PERSON. THE ELEMENT OF PERSONAL AND CLOSE RELATIONSHIP BETWEEN THE TWO IS THE MOTIVATING FACTOR AS THE DONOR PARTS WITH AND TRANS FERS WHAT BELONGS TO HIM TO SOMEONE, WHOM HE OR SHE LOVE AND CARES. THE CREDIT WORTHINESS OF THE DONOR WOULD DE PEND UPON THE INCOME AND EARNING OF THE DONOR AND WHETHE R HE HAD NECESSARY FUNDS. THE POOR PERSON CANNOT GIVE G IFTS TO A RICH AND POWERFUL MAN EVEN OUT OF NATURAL LOVE AN D AFFECTION. THERE SHOULD BE OCCASION FOR MAKING THE GIFT BY THE DONOR TO THE DONEE. IT IS NOT NECESSARY FOR TH E REVENUE TO SHOW THAT PROVE HOW THE ASSESSEE THROUGH A CONDU IT HAD TRANSFERRED AND BROUGHT INTO BOOKS OF ACCOUNT, UNDISCLOSED INCOME UNDER SECTION 68 OF THE ACT. TH E 5 GENUINENESS OF THE TRANSACTION HAS TO BE EXAMINED N OT ONLY TAKING INTO CONSIDERATION THE DOCUMENTS, WHICH WERE EXECUTED BY THE PARTIES BUT THE SURROUNDING CIRCUMSTANCES ALSO. 8(II) CONSIDERING THE ABOVE PRINCIPLE IN MIND, WE F IND THAT THERE IS NO VALID GIFT RECEIVED BY THE ASSESSE E FROM SHRI ASHOK SURI. THE ASSESSEE, AT THE ASSESSMENT S TAGE, FIELD CONFIRMATION OF SHRI ASHOK SURI IN WHICH IT W AS EXPLAINED THAT HE HAS GIVEN SUM OF RS. 1 LAC TO THE ASSESSEE ON 31.03.2006 AS GIFT BY CONVERTING THE UNSECURED LOAN GIVEN EARLIER TO THE ASSESSEE. IN T HIS CONFIRMATION, NO DATE OF GIVING LOAN TO THE ASSESSE E HAVE BEEN MENTIONED AND EVEN NO MODE AND RELATIONSHIP WI TH THE ASSESSEE HAVE BEEN EXPLAINED. THE LOAN IS UNDE R COMPULSION A LIABILITY UPON ASSESSEE AND IS WITH CONSIDERATION. HOWEVER, IN CASE OF GIFT, THE SAME IS VOLUNTARY AND WITHOUT CONSIDERATION. IT IS NOT EXP LAINED UNDER WHAT CIRCUMSTANCES OR REASONS OR OCCASION, UNSECURED LOAN WAS CONVERTED INTO GIFT AT THE FAG E ND OF CLOSE OF THE FINANCIAL YEAR ON 31.03.2006. THE COP Y OF THE BANK ACCOUNT OF THE DONOR WAS ALSO NOT FILED BEFORE AUTHORITIES BELOW AND NO SOURCE OF HIS GIVING GIFT TO THE ASSESSEE HAVE BEEN PROVED BY ANY EVIDENCE. THEREFO RE, MERE FILING OF CONFIRMATION AND AFFIDAVIT OF THE DO NOR WOULD NOT SERVE ANY PURPOSE. 8(III) HON'BLE CALCUTTA HIGH COURT IN THE CASE OF B HARTI PVT. LTD. 111 ITR 951 AND UNITED COMMERCIAL & INDU STRIAL 6 CO. LTD. 187 ITR 596 HAVE HELD THAT MERE FILING OF CONFIRMATION IS NOT ENOUGH TO PROVE GENUINE CREDITS UNDER SECTION 68 OF THE ACT. IT IS ALSO WELL SETTLED LAW THAT MERELY BECAUSE TRANSACTION IS ROUTED THROUGH BANKIN G CHANNEL, IS NOT SACROSANCT TO PROVE NON GENUINE TRANSACTION TO BE GENUINE. THE BURDEN IS UPON THE ASSESSEE UNDER SECTION 68 OF THE INCOME TAX ACT TO PROVE THE IDENTITY OF THE DONOR, CREDIT WORTHINESS OF THE DONOR AND GENUINENESS OF THE TRANSACTION IN THE MATTER. THE ASSESSEE, HOWEVER, FAILED TO PROVE CREDIT WORTHINES S OF THE DONOR AS WELL AS GENUINE TRANSACTION OF THE MATTER. IT IS, THEREFORE, PROVED ON RECORD THAT IT WAS UNACCOUNTED MONEY OF THE ASSESSEE WHICH WAS ROUTED IN THE NAME OF ALL EGED GIFT IN THE BOOKS OF ACCOUNT/BANK ACCOUNT OF THE AS SESSEE. IN THE ABSENCE OF ANY COGENT AND RELIABLE EVIDENCE ON RECORD, WE DO NOT FIND ANY JUSTIFICATION TO INTERFE RE WITH THE ORDER OF AUTHORITIES BELOW. WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE. THE SAME IS, ACCORDING LY, DISMISSED. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (ANNAPURNA GUPTA) (BHAVNESH SA INI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28 TH APRIL, 2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD