Shri V.K.Singh, Bhopal V. The A.C.I.T., Bhopal

ITA 232/IND/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 1498 (ITAT-INDORE)
• Duration Of Justice: 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2009
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 12-10-2009
• Assessment Year: 2006-2007
• Appeal Filed On: 13-05-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Keywords: Gift; Salary income
• Section: 143(2)

Judgement Text

PAGE 1 OF 4 IN THE INCOME TAX APPELATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JM AND SHRI V.K. GUPTA, AM ITA NO.232/IND/2009 AY: 2006-07 V.K. SINGH (PAN ANFPS 2394 M) C/O C.H. PADLIYA & CO. 2 ND FLOOR, 13-14, RNT MARG, DAWA BAZAR, INDORE ..APPELLANT V/S. ACIT-2(1), BHOPAL ..RESPONDENT ASSESSEE BY : SHRI SUDHIR PADLIYA, CA DEPARTMENT BY : SMT. APARNA KARAN, SR. DR ORDER PER JOGINDER SINGH, JM THIS APPEAL IS BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-I, BHOPAL, DATED 20.3.2009 FOR THE AY 2006-07 ON THE GROUND THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. FIRST APPELLATE AUTHORITY ERRED IN CONFIRMING THE ADDITION OF RS.7 LAKHS, REPRESENTING THE AMOUNT OF GIFT RECEIVED FROM HIS ELDER BROTHER. 2. DURING HEARING OF THIS APPEAL, WE HAVE HEARD SHR I SUDHIR PADLIYA, LD. COUNSEL FOR ASSESSEE AND SMT. APARNA KARAN, LD. SR. DR. THE CRUX OF ARGUMENTS ADVANCED BY SHRI PADLIYA IS THAT THE SOUR CE OF THE IMPUGNED PAGE 2 OF 4 AMOUNT WAS EXPLAINED, THE ASSESSEE MIGRATED FROM UT TARPRADESH AND SETTLED IN BHOPAL, THE AMOUNT OF RS.1,50,000/- WAS WITHDRAW N FROM PF ACCOUNT AND WAS DEPOSITED THROUGH CHEQUE AND THE CASH AMOUNT OF RS.70,000/- WAS WITHDRAWN FROM ANOTHER BANK. ON THE OTHER HAND, THE LD. SR. DR STRONGLY DEFENDED THE IMPUGNED ORDER BY CONTENDING THAT THE GENUINENESS OF TRANSACTION IS IN SERIOUS DOUBT AS THE ASSESSEE RAI SED HOUSING LOAN AND GIFTED TO HIS BROTHER, CONSEQUENTLY, THE GENUINENESS OF TH E TRANSACTION IS CLOUDY. IT WAS PLEADED THAT THE TRANSACTION THROUGH BANKING CH ANNEL IS ALWAYS NOT SACROSANCT FOR WHICH RELIANCE WAS PLACED UPON THE D ECISION IN NEMICHAND KOTHARI (264 ITR 254) (GAUHATI). 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON FILE. BRIEF FACTS ARE THAT THE ASSESSE E DERIVES INCOME FROM SALARY, HOUSE PROPERTY, INTEREST INCOME AND SHARE OF PROFIT IN FIRM ETC. ALONG WITH INCOME FROM AGRICULTURE. THE ASSESSEE SHOWED TOTAL INCOME OF RS.2,19,674/- AND AGRICULTURAL INCOME OF RS.20,000/- IN ITS RETUR N FILED ON 31.10.2006. THE CASE WAS SELECTED FOR SCRUTINY, CONSEQUENTLY, NOTIC E U/S 143(2) WAS SERVED UPON THE ASSESSEE. IN RESPONSE, THE ASSESSEE ATTEND ED THE PROCEEDINGS AND PLACED ON RECORD THE BOOKS OF ACCOUNT, SUPPORTING B ILLS, VOUCHERS ETC. DURING COURSE OF SCRUTINY, IT WAS FOUND THAT THE ASSESSEE TOOK GIFTS AMOUNTING TO RS.9,85,000/- FROM TWO PERSONS (RS.2,85,000 FROM HI S MOTHER SMT. INDRAVATI DEVI AND RS.7 LAKHS FROM HIS BROTHER NAMELY I.E. DR . AK SINGH). THE ASSESSEE WAS ASKED TO PRODUCE THE SOURCE OF THESE GIFTS. A H OUSING FINANCE LOAN OF RS.7 PAGE 3 OF 4 LAKHS WAS CLAIMED TO BE GIFTED TO THE ASSESSEE. ADM ITTEDLY, THE HOUSE LOAN WAS MEANT FOR HOUSE CONSTRUCTION. THE DONOR I.E. SH RI A.K. SINGH WAS A PROFESSOR IN COLLEGE AND WAS DRAWING RS.20,000 PER MONTH. THE GIFT FROM MOTHER WAS FOUND TO BE GENUINE WHEREAS THE AMOUNT O F RS.7 LAKHS WAS DISALLOWED AND ADDED TO THE INCOME OF THE ASSESSEE. ON APPEAL, THE ASSESSMENT ORDER WAS AFFIRMED WHICH IS UNDER CHALLE NGE BEFORE THIS TRIBUNAL BY THE ASSESSEE. IT IS SEEN THAT ADMITTEDLY, THE SO URCE OF RS.7 LAKHS IS EXPLAINED AS THE SAME WAS A HOUSING LOAN, THE ONLY DISPUTE IS THAT A PERSON WHO IS TAKING A LOAN FOR CONSTRUCTION OF THE HOUSE IS GIFTING THE AMOUNT TO HIS BROTHER. ADMITTEDLY, THERE IS SHADOW OF DOUBT AS TH E EXPLANATION PUTFORTH BY THE ASSESSEE IS NOT CONVINCING. IT IS ALSO AN ADMIT TED FACT THAT THE DONEE IS THE YOUNGER BROTHER OF THE DONOR AND THE SOURCE OF THE AMOUNT IS KNOWN. ADMITTEDLY, THE PAYMENT THROUGH BANKING CHANNEL IS ALWAYS NOT SACROSANCT BECAUSE UNDER THE AFOREMENTIONED FACTS THE DONOR RA ISED A HOUSING LOAN AND WITHOUT MAKING ANY CONSTRUCTION GIFTED THE AMOUNT H IS BROTHER, THEREFORE, THE GENUINENESS OF THE TRANSACTION IS CLOUDY. DURING HE ARING OF THE APPEAL, THE LD. COUNSEL FOR ASSESSEE CONTENDED THAT THE DONEE WANTE D TO START A BUSINESS, THEREFORE, WAS IN NEED OF MONEY. WE ARE OF THE VIEW THAT THIS EXPLANATION OF THE ASSESSEE IS AGAIN NOT CONVINCING BECAUSE NOTHIN G PREVENTED THE DONEE TO TAKE LOAN FOR BUSINESS. THERE IS A POSSIBILITY THAT HOUSING LOAN MAY BE CHEAPER THAN BUSINESS LOAN. EVEN IF THIS ISSUE IS ANALYSED WITH THE ANGLE OF HUMAN PROBABILITY, UNDER THE AFOREMENTIONED FACTS, STILL IT GOES AGAINST THE ASSESSEE PAGE 4 OF 4 BECAUSE IT IS EXPECTED THAT A PERSON (DONOR) WHO IS RAISING LOAN FOR MAKING A CONSTRUCTION OF THE HOUSE MAY NOT GIFT THE AMOUNT T O A RELATIVE. THE OBVIOUS REPLY IS NO. THE EXPLANATION OF THE SOURCE ITS ELF CANNOT BE SAID TO BE A GROUND FOR CLAIMING THE TRANSACTION OF GIFT AS GENU INE, THEREFORE, WE HAVE NOT FOUND ANY INFIRMITY IN THE IMPUGNED ORDER. IT IS UP HELD. IN THE RESULT, THIS APPEAL OF THE ASSESSEE IS HAVI NG NO MERIT, THEREFORE, DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 .10.20 09. SD/- SD/- (V.K. GUPTA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 13 .10.2009 !VYAS! COPY TO: APPELLANT/RESPONDENT/CIT/CIT(A)/DR