Shri B. Venkatesh, Villupuram V. ITO, Villupuram

ITA 2104/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8219 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 12-07-2016
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Assessee Lawyers: V S JAYAKUMAR
• Keywords: Unexplained investment; Gift
• Section: 68; 2

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI . . . , . . ' # $ , % &' ( [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D. S. SUNDER SINGH, ACCOUNTANT MEMBER ] ./ I.T.A.NO.2104/MDS/2016 / ASSESSMENT YEAR : 2011-12 SHRI B. VENKATESH PROP. SRI VENKATESWARA AGENCIES NO.4, SUDHAKAR NAGAR VILLUPURAM 605 602 VS. THE INCOME TAX OFFICER WARD I VILLUPURAM [PAN AABPV 0306 P] ( )* / APPELLANT) ( +,)* /RESPONDENT) / APPELLANT BY : SHRI V.S.JAYAKUMAR, ADVOCATE /RESPONDENT BY : SHRI A.V. SREEKANTH, JCIT / DATE OF HEARING : 18 - 10 - 2016 ! / DATE OF PRONOUNCEMENT : 28 - 10 - 2016 / O R D E R PER D.S. SUNDER SINGH, ACCOUNTANT MEMBER THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS), PUDUCHER RY, DATED 25.5.2016 FOR ASSESSMENT YEAR 2011-12. 2. ALL THE GROUNDS OF APPEAL ARE RELATED TO THE ADDITI ON OF ` 2 LAKHS U/S 68 OF THE INCOME-TAX ACT, 1961[ IN SHORT THE ACT]. ITA NO. 2104/16 :- 2 -: 3. DURING ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICE R FOUND THAT A SUM OF ` 5 LAKHS WAS FOUND CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE IN THE CAPITAL ACCOUNT. IT WAS EXPLA INED AS GIFT RECEIVED FROM HIS MOTHER SMT. B. PREMALATHA. THE ASSESSEE EXPLAINED THAT THE SOURCE WAS ON ACCOUNT OF SALE OF PROPERTY BY SMT. P REMALATHA ALONGWITH FIVE OTHERS A LAND AND BUILDING FOR A CON SIDERATION OF ` 15 LAKHS. THE ASSESSEES MOTHER SMT. PREMALATHA IS C LAIMED TO BE ONE OF THE CO-OWNERS OF THE PROPERTY. THE ASSESSING OFFIC ER EXAMINED THE CLAIM OF THE ASSESSEE AND FOUND THAT THE SHARE OF HIS MOTHER WAS ONLY ` 3 LAKHS AND DIRECTED THE ASSESSEE TO EXPLAIN THE SOURCE OF REMAINING ` 2 LAKHS. SINCE THE ASSESSEE FAILED TO EXPLAIN TH E SOURCE AND NATURE OF ` 2 LAKHS WAS ADDED BACK TO THE INCOME U/S 68 OF TH E ACT. THE ASSESSEE CHALLENGED THE ASSESSMENT BEFORE THE CIT(A ) AND THE CIT(A) CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICE R. THEREFORE, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 4. THE LD. AR APPEARING FOR THE ASSESSEE ARGUED THAT THE ASSESSEES MOTHER SMT. B PREMALATHA IS HAVING TWO P ROPERTIES AND FETCHING RENT OF ` 1500/- PER MONTH FROM EACH PROPERTY AND THEREFORE, HAS AN INDEPENDENT SOURCE OF INCOME. SHE MADE THE SAVINGS OUT OF RENTAL INCOME AND FROM THE SAVINGS SHE HAS ADVANCED A SUM OF ` 2 LAKHS TO HER SON. THEREFORE, THE LD.AR WAS OF THE OPINION THAT THERE ITA NO. 2104/16 :- 3 -: WAS NO UNEXPLAINED INVESTMENT AND ADDITION MADE BY THE ASSESSING OFFICER IS UNJUSTIFIED. 5. ON THE OTHER HAND, THE LD. DR ARGUED THAT THE ASSE SSEES MOTHERS INCOME IS ONLY ` 3,000/- PER MONTH WHICH IS NOT EVEN SUFFICIENT TO MEET HER BASIC NEEDS AND SHE IS ALSO NOT AN INCOME-TAX ASSESSEE. THEREFORE, THE ASSESSEES MOTHER CANNOT HAVE ANY SURPLUS FUNDS TO ADVANCE THE AMOUNT TO THE ASSESSEE. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL PLACED BEFORE US. THERE WAS A SUM OF ` 5 LAKHS CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE AND THE ASSESSEE HAS EXPLAINED THE SOURCE OF ` 3 LAKHS AS GIFT RECEIVED FROM HIS MOTHER, SMT. B PREMALATHA WHICH WAS SUBSTANTIATED BY THE CONVEYANC E DEED AND GIFT DEED PLACED BEFORE THE ASSESSING OFFICER. THE REMA INING AMOUNT WAS EXPLAINED TO BE GIVEN BY HIS MOTHER OUT OF RENTAL I NCOME OF ` 3,000/- PER MONTH. AS RIGHTLY EXPLAINED BY THE LD. DR, THE AMOUNT OF ` 3,000/- IS BARELY SUFFICIENT TO MEET THE MONTHLY EXPENSES A ND THERE IS NO CASE FOR MAKING ANY SURPLUS FUNDS AND NO OTHER SOURCE WA S EXPLAINED BY THE ASSESSEE. THEREFORE, WE AGREE WITH THE CIT(A) S ORDER THAT THE CREDIT OF ` 2 LAKHS REMAINED UNEXPLAINED AND ADDITION MADE BY THE ASSESSING OFFICER IS CONFIRMED. ITA NO. 2104/16 :- 4 -: 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH OCTOBER, 2016, AT CHENNAI. SD/- SD/- ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER ( . . ' # $ ) (D.S. SUNDER SINGH) % / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 28 TH OCTOBER, 2016 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF