Muthuvairavan Gnanasakthi, Thanjavur V. The Income Tax Officer (International Taxation), Ward-1(1), Bangalore

ITA 243/BANG/2022

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 0661 (ITAT-BANGALORE)
• Duration Of Justice: 1 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2017-2018
• Appeal Filed On: 10-04-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: GANGADHAR SASTRY
• Keywords: Gift; Principle of natural justice; Set aside
• Section: 69; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” “B” BENCH, BENGALURU Before Shri B.R. Baskaran, Accountant Member IT(IT)A No. 243/Bang/2022 (Assessment Year: 2017-18) Shri Muthuvairavan Gnanasakthi 1/108, West Street, Nadiyam Post Peravurani Taluk, Thanjavur Tamil Nadu, PIN 614802 Vs. The Income Tax Officer Ward - Intl. Taxation - 1(1) Bengaluru PAN – AKGPG6019F Appellant Respondent Appellant by: Shri Gangadhar Sastry, ITP Respondent by: Shri Ganesh R. Ghale Standing Counsel for Revenue Date of Hearing: 30.05.2022 Date of Pronouncement: 31.05.2022 O R D E R Per: B.R. Baskaran, A.M. The assessee has filed this appeal challenging the order dated 14.02.2022 passed by the learned CIT(A)-12, Bengaluru and it relates to AY 2017-18. 2. The assessee is aggrieved by the decision of the learned CIT(A) in confirming the addition of Rs.15,00,000/- being the amount deposited in the bank account during the demonetisation period. 3. The facts relating to the case are stated in brief. It was noticed by the AO that the assessee has deposited a sum of Rs.15,00,000/- in his bank account maintained with the Axis Bank during the demonetisation period. Though the AO called for explanations from the assessee, the assessee simply submitted that he was a non-resident during the year under IT(IT)A No. 243/Bang/2022 Shri Muthuvairavan Gnanasakthi 2 consideration. It was noticed by the AO that assessee has not given any explanation with regard to the deposit of Rs.15,00,000/- into his bank account. Accordingly the AO assessed the sum as income of the assessee under Section 69 of Income Tax Act, 1961 (hereafter "the Act"). It is pertinent to note that the AO has completed the assessment to the best of his judgement under Section 144 of the Act. 4. Before the learned CIT(A) the assessee offered an explanations stating that the above said amount of Rs.15,00,000/- was received as gift by his wife, named Smt. Dharani Gnanasakthi from her father, named Shri Gajendran and it was deposited into the bank account of the assessee. In support of the above said claim the assessee also furnished gift deed executed by Shri Gajendran in favour of Smt. Dharani Gnanasakthi. In the gift deed it was stated that the sources for giving the gift is advance received against Agreement for sale entered by him for sale of land. Subsequently the assessee filed another letter on 19.01.2022 with the CIT(A), wherein the sources for giving the gift were proceeds received on sale of agricultural produce. The assessee also furnished details of agricultural holdings of Shri Gajendran. The Ld CIT(A) took the view that the father-in-law of the assessee Shri Gajendran has given contradictory explanations with regard to the sources for the gift given by him and accordingly he did not accept the explanations. Accordingly, he confirmed the addition made by the AO. Aggrieved the assessee has filed this appeal before the Tribunal. 4. The learned A.R. submitted that the assessee could not properly represent his case before the AO. However, the assessee has filed all documents relating to source of gift given to Smt. Dharani Gnanasakthi (assessee’s wife). However, all those documents have not been examined by the learned CIT(A). He submitted that the learned CIT(A) has given importance to the explanations given with regard to the sources of amount gifted. The learned A.R. submitted that the important point is that Shri Gajendran was having sufficient money for giving gift and hence the contradiction in giving explanations with regard to the sources should not IT(IT)A No. 243/Bang/2022 Shri Muthuvairavan Gnanasakthi 3 be taken seriously. He submitted that, if the documents furnished by the assessee before the learned CIT(A) are properly examined, the tax authorities would be satisfied with regard to the availability of sources with Shri Gajendran. Accordingly he prayed that the assessee may be provided with one more opportunity to present his case properly before the AO. 5. The learned D.R., on the contrary, opposed the plea put forward by the learned A.R. He submitted that the order passed by the learned CIT(A) does not call for any interference. 6. I heard the rival contentions and perused the record. I noticed earlier that the AO was constrained to pass the order to the best of his judgement under Section 144 of the Act, since the assessee did not offer proper explanations with regard to the deposit of Rs.15,00,000/- made into his bank account during the demonetisation period. The assessee has stated that the source of Rs.15,00,000/- was gift amount received from Shri Gajendran (father-in-law of the assessee) by Smt. Dharani Gnanasakthi (wife of the assessee). There was some contradiction in the reply given by Shri Gajendran. However, I notice that the learned CIT(A) has not examined the evidences furnished by shri Gajendran, on the reasoning that the explanations given for the sources of deposit were contradictory. It is the submission of the learned A.R. that the assessee would be in a position to satisfy the AO about the availability of sources with Shri Gajendran, if an opportunity is given. What is important is the availability of the sources with Shri Gajendran at the time of giving gift, which should be corroborated with proper evidences. Admittedly, the evidences furnished by the assessee has not been examined by Ld CIT(A). Accordingly, in my view, in the interest of natural justice, the assessee may be provided with an opportunity. Accordingly I set aside the order of the learned CIT(A) and restore the issue to the file of the AO for examining it afresh by considering the documents, information and explanations that be furnished by the assessee. IT(IT)A No. 243/Bang/2022 Shri Muthuvairavan Gnanasakthi 4 7. In the result, the appeal filed by the assessee is treated as allowed for statistical purposes. Dictated and pronounced in the open Court on 31 st May, 2022. Sd/- (B.R. Baskaran) Accountant Member Bengaluru, Dated: 31 st May, 2022 Copy to: 1. The Appellant 2. The Respondent 3. The CIT(A) -12, Bengaluru 4. The CIT - (Intl. Taxn) (SZ) Bengaluru 5. The DR, ITAT, Bengaluru 6. Guard File By Order //True Copy// Assistant Registrar ITAT, Bengaluru n.p.