ITO 25(2)(2), MUMBAI V. MEERA DIVAKARAN NAIR, MUMBAI

ITA 2236/MUM/2012

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9175 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2015
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 25-03-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 04-04-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PAWAN KUMR BEERLA
• Keywords: Gift

Judgement Text

, INCOME TAX APPELLATE TRIBUNAL,MUMBAI - F BENCH , , BEFORE S/SH. I P BANSAL,JUDICIAL ME MBER & RAJENDRA,ACCOUNTANT MEMBER /. ITA NO.2236/MUM/2012, ! ! ! ! ' ' ' ' / ASSESSMENT YEAR-2008-09 ITO 25(2)(2), C-11 BLDG., R.NO. 106, PRATYAKSHKAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI-51. VS MEERA DI VAKARAN NAIR , A-503, RSK CHSL, I.C. COLONY, BORIVALI (W), MUMBAI-92. PAN:AERPN4759C ( #$ / ASSESSEE) ( %&#$ / RESPONDENT) ' ( / REVENUE BY :SHRI PAWAN KUMR BEERLA !)* !)* !)* !)* ( ( ( ( /ASSESSEE BY :NONE ! ! ! ! ' '' ' *+ *+ *+ *+ / DATE OF HEARING : 25 - 03 -2015 ,-' ' *+ / DATE OF PRONOUNCEMENT : 25 -03-2015 ! ! ! ! , 1961 ' '' ' 254(1) *.* *.* *.* *.* / / / / ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA,AM ! ! ! ! : CHALLENGING THE ORDER DT.21.01.2012 OF THE CIT(A)-3 5,MUMBAI,ASSESSING OFFICER (AO) HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT O F GIFT OF RS.8,24,000/- WITHOUT APPRECIATING THE FACT THAT THE ASSESSING OFFICER DULY CONFRONTED THE ISSUE TO ASSESSEE AND ASSESSEE HAS ALSO ACCEPTED FOR THE SAID ADDITION VIDE ORDER-SHEET NOTING DTD.2 3.12.2010. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT O F LOAN OF RS.5,13,377/- WITHOUT APPRECIATING THE FACT THAT THE ASSESSING OFFICER DULY CONFRONTED THE ISSUE TO ASSESSEE AND ASSESSEE HAS ALSO ACCEPTED FOR THE SAID ADDITION VIDE ORDER-SHEET NOT ING DTD.23.12.2010. 3. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUNDS TO BE SET ASIDE AND THAT OF THE A.O BE RESTORED. 4. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND. 2. ASSESSEE,AN INDIVIDUAL, FILED HER RETURN OF INCOME ON 25.09.2008 DECLARING TOTAL INCOME AT RS.2,90,660/-.THE AO COMPLETED THE ASSESSMENT U/S.1 43(3)OF THE ON 24.12.10DETERMINING THE INCOME OF THE ASSESSEE AT RS. 22,24,220/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO FOUND THAT ASSESSEE HAD SHOWN TO HAVE RECEIVED A GIFT OF RS. 8.24 LAKHS FROM HER HUSBAND, DIVAKARAN NAIR.AS PER THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS,THE ASSESSEE HAD F AILED TO ESTABLISH EITHER THE CREDITWORTHY -NESS OF THE DONOR OR THE GENUINENESS OF THE GIFT S TATED TO BE RECEIVED FROM HER HUSBAND. THE AO ASKED THE ASSESSEES AUTHORISED REPRESENTATIVE(A R)TO SHOW CAUSE AS TO WHY THE GIFT SHOULD NOT TREATED AS UNEXPLAIN ED CASH CREDIT.AS P ER THE AO,ON 23.12.2010,THE AR OF THE ASSESSEE AGREED FOR THE PROPOSED ADDITION.CONSIDERI NG THOSE FACTS,THE AO HELD THAT GIFT OF RS. 8.24 LAKHS WAS UNPROVED AND HAD TO BE TREATED AS UN EXPLAINED CASH CREDIT U/S.68 OF THE ACT. WHILE GOING THROUGH THE BALANCE-SHEET THE AO FOUND THAT THE ASSESSEE HAD SHOWN UNSECURED LOANS OF RS.5 LAKHS AND RS. 5.13 LAKHS FROM GEETA N ANDAN AND DIVAKARAN NAIR RESPECTIVELY. AS PER THE AO,THE ASSESSEE FAILED TO FURNISH ANY LO AN CONFIRMATION IN SUPPORT OF THE ABOVE UNSECURED LOANS.AS IN THE CASE OF GIFT RECEIVED BY THE ASSESSEE IN CASE OF THE LOANS ALSO ENQUIRIES WERE MADE BY THE AO.AS PER THE AO ON 23. 12.2010 THE AR OF THE ASSESSEE AGREED 2 ITA NO.2236/M/12 MEERA DIVAKARAN NAIR FOR THE PROPOSED ADDITION.THEREFORE, THE AO ADDED R S. 10.13 LAKHS TO THE INCOME OF THE ASSESSEE AS UNPROVED UNSECURED LOANS, U/S.68 OF THE ACT. 3. AGGRIEVED BY THE ORDER OF THE AO,THE ASSESSEE PREFE RRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA).BEFORE HIM,IT WAS ARGUED S HE HAD FILED PROPER DOCUMENTS BEFORE THE AO,THAT HE DID NOT TAKE INTO CONSIDERATION THE DOCUMENTS FILED BY THE ASSESSEE, THAT THE GIFT WAS GIVEN TO HER BY HER HUSBAND OUT OF HIS NRI INCOME,THAT THE ASSESSEE HAD SUBMITTED GIFT DOCUMENT BEFORE THE AO,THAT UNSECURED LOANS FR OM GEETA NANDAN AND DIVA -KARAN NAIR WERE PART OF THE DOCUMENTS PRODUCED BY THE ASSESSEE ,THAT THE ENTRY IN THE PASS-BOOK CLEARLY SHOWED THAT SHE HAD RECEIVED GIFT,FROM HER HUSBAND, THROUGH BANKING CHANNELS. REGARDING THE UNSECURED LOANS IT WAS ARGUED THAT SHE HAD TAKEN UN SECURED LOAN FOR EXTENSION OF HER BUSINESS,THAT ALL THE TRANSACTIONS HAD BEEN THROUGH CHEQUES ONLY,THAT IT HAD COME FROM THE NRI ACCOUNT,THAT HER HUSBAND HAD TAKEN GOLD LOAN OF RS. 4.30 LAKHS FROM SOUTH INDIAN BANK LTD. AND HAD GIVEN TO THE ASSESSEE,THAT THE ASSESSE E HAD SUBMITTED THE LOAN CONFIRMA -TION STATEMENT AND LOAN STATEMENT WITH INCOME TAX RETURN S OF HER HUSBAND. AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE AN D THE ASSESSMENT ORDER,THE FAA HELD THAT THE GIFT FROM THE HUSBAND OF THE ASSESSEE COULD NOT BE RULED OUT TO BE NEGATIVE UNLESS THE AO PROVED THAT IT WAS ACTUALLY TAXABLE MONEY OF THE AS SESSEE THAT WAS ROOTED THROUGH SOME OTHER CHANNEL INTO THE BANK ACCOUNT OF HER HUSBAND AND WA S RECEIVED AS GIFT TO AVOID TAXES,THAT AO HAD NOT GATHERED ANY SUCH MATTER.FINALLY,HE DELETED THE ADDITION MADE BY THE AO,AMOUNTING TO RS.8.24 LAKHS.THE FAA ALSO DELETED THE ADDITION MADE BY THE AO ON ACCOUNT LOAN TAKEN FROM DIVAKARAN NAIR.WITH REGARD TO THE LOAN RECEIVE D FROM GEETA NANDAN,AMOUNTING TO RS. 5 LAKHS,THE FAA HELD THAT THE ASSESSEE HAD FAILED TO PROVE THE GENUINENESS OF THE TRANSACTION. HE CONFIRMED THE ADDITION MADE BY THE AO TO THE TUN E OF RS. 5 LAKHS. 5. BEFORE US,DEPARTMENTAL REPRESENTATIVE(DR)STATED THA T THE AR OF THE ASSESSEE HAD ADMITTED THE ADDITIONS PROPOSED BY THE AO,DURING THE ASSESSM ENT PROCEEDINGS.AS STATED EARLIER, NOBODY HAD APPEARED ON BEHALF OF THE ASSESSEE THOUG H WRITTEN SUBMISSIONS WERE MADE ALONG WITH CERTAIN DOCUMENTS.THESE DOCUMENTS CONTAIN THE CERTIFICATE FROM SOUTH INDIAN BANK AND DETAILS OF BANK ACCOUNT OF DIVAKARAN NAIR ALONG WIT H THE COPY OF THE BANK STATEMENT OF ORIENT EXPRESS LOGISTICS,PROPRIETARY CONCERN OF THE ASSESSEE. WE FIND THAT WHILE DECIDING THE APPEAL THE FAA HAS DISCUSSED ABOUT THE BANK PASSBOOK AND THE AFFIDAVIT OF HUSBAND OF THE ASSESSEE ABOUT THE GIFT MADE BY HIM. WE FIND THAT THE AO HAD CLEARLY STATED THAT NO DOCUMENTARY EVIDENCES WERE F ILED BEFORE HIM. IN THESE CIRCUMSTANCES, TO DECIDE THE APPEAL IN FAVOUR OF THE ASSESSEE ON T HE BASIS OF PAPERS SUBMITTED BEFORE HIM, BY THE FAA, IN OUR OPINION,IS VIOLATION OF RULE 46A OF THE INCOME-TAX RULES, 1961. AS THE AO HAD NO OCCASION TO GO THROUGH THE PAPERS SUBMITTED BEFORE THE FAA OR BEFORE US. WE ARE OF THE OPINION THAT,IN THE INTEREST OF JUSTICE,MATTER SHOULD BE RESTORED BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION.THE AO IS DIRECTED TO AFFORD A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE AND THE ASSESSEE IS DIRECTED TO EXTEND FUL L COOPERATION TO THE AO BY SUBMITTING NECESSARY DOCUMENTS DURING THE NEXT ROUND OF HEARIN G.EFFECTIVE GROUND OF APPEAL FILED BY THE AO STANDS PARTLY ALLOWED. AS A RESULT,APPEAL FILED BY THE AO IS ALLOWED IN PART. *1 !)* 2 3 ' . /*1 4 ' * 56 . ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH ,MARCH,2015. / ' ,-' 7 8! 25 9 ,2015 - ' . : SD/- SD/- ( /I P BANSAL) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER 3 ITA NO.2236/M/12 MEERA DIVAKARAN NAIR / MUMBAI, 8! /DATE: 25.03.2015 SK / / / / ' '' ' %* %*%* %*; ; ; ; <;'* <;'* <;'* <;'* / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / #$ 2. RESPONDENT / %&#$ 3. THE CONCERNED CIT(A)/ = > , 4. THE CONCERNED CIT / = > 5. DR F BENCH, ITAT, MUMBAI / ;?. %*! , ,Q ,Q,Q ,Q , . . . 6. GUARD FILE/ . &;* %* //TRUE COPY// /! / BY ORDER, @ / 5 DY./ASST. REGISTRAR , /ITAT, MUMBAI.