The ITO, Ward-9(1), Ahmedabad V. Shri Ragesh Popatlal Shah, Ahmedabad

ITA 2754/AHD/2010

• Counselvise Citation: 275420514 RSA 2010
• Duration Of Justice: 3 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 31-07-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 27-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P JHANGID
• Assessee Lawyers: VIJAY RANJAN
• Keywords: Gift; Question of law
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT , JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER ITA NO. 2754 & 2656/AHD/2010 ASSESSMENT YEAR :2007-08 I.T.O. WARD-9(1), AHMEDABAD SHRI RAGESH POPATLAL SHAH PROP OF M/S DHARTI ASSOCIATES 2/A, HASMUKH COLONY, VIJAYNAGAR ROAD, NARANPURA, AHMADABAD. V/S . V/S. SHRI RAGESH POPATLAL SHAH PROP OF M/S DHARTI ASSOCIATES 2/A, HASMUKH COLONY, VIJAYNAGAR ROAD, NARANPURA, AHMADABAD. I.T.O. WARD-9(1), AHMEDABAD PAN NO. A CWPS4490G (APPELLANT) .. (RESPONDENT) BY REVENUE SHRI J. P. JHANGID, SR.D.R. /BY ASSESSEE SHRI VIJAY RANJAN, A.R. /DATE OF HEARING 31.07.2013 /DATE OF PRONOUNCEMENT 27.09.2013 O R D E R PER : SHRI T.R.MEENA, ACCOUNTANT MEMBER THESE ARE CROSS APPEALS FILED BY THE ASSESSEE AND R EVENUE IN ITA NOS. 2754/AHD/10 & 2656/AHD/10 RESPECTIVELY WHICH H AVE EMANATED FROM THE ORDER OF CIT(A)-XV, AHMEDABAD, DATED 20 TH JULY, 2010 FOR ASSESSMENT YEAR 2007-2008. BOTH CROSS APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONV ENIENCE. THE REVENUE IS ITA NOS. 2754 & 2656/AHD/2010 A.Y. 07-08 PAGE 2 AGAINST DELETING THE ADDITION MADE BY THE ASSESSING OFFICER U/S. 68 OF THE IT ACT TO THE EXTENT OF RS.16,87,719/- AND ASSESSEE IS AGAINST CONFIRMING THE ADDITION OF RS.8,06,460/-. 2. THE A.O. OBSERVED THAT ASSESSEE HAD RECEIVED SIX GIFTS IN TOTAL OF RS.24,94,179/- FROM HIS SISTER ASMITA SONI, RESIDEN T OF USA. THE A.O. GAVE REASONABLE OPPORTUNITY TO PROVE THE GENUINENESS OF THE GIFT WITH EVIDENCE. THE ASSESSEE SUBMITTED DURING THE COURSE OF ASSESSM ENT PROCEEDING COPY OF GIFT DEED, COPY OF PASSPORT, EVIDENCE OF INCOME IN AMERICA / COPY OF RETURN AND RELATIONSHIP WITH DONOR AND OCCASION OF THE GIF T. BUT, THE A.O. DID NOT CONVINCE THE EVIDENCE SUBMITTED BEFORE HIM ON THE F OLLOWING REASONS: I. THE GIFT DEED IS SILENT ON THE BLOOD RELATIONSHI P EXISTING BETWEEN THE DONOR AND THE DONEE. II. THE SISTER GENERALLY GETS GIFTS FROM BROTHER, I T IS VICE VERSA. III. THERE WAS NO OCCASION. THESE GIFTS WERE ISSUE D IN MULTIPLE CHEQUES, IN THREE MONTHS TOTAL SIX GIFTS WERE GIVEN BY THE SIST ER. IV. THE GIFT DEEDS WERE NOT NOTARIZED. V. MRS. ASMITA SONI WAS NOT AVAILABLE TO EXECUTE TH E GIFT DEED ON 14.09.2006. VI. THERE WAS NO SUFFICIENT FUND AVAILABLE WITH THE DONOR. VII. THERE WAS NO GIFT FROM SISTER IN EARLIER YEARS . VIII. THERE WAS A COUNTER CREDIT IN THE BANK ACCOUN T. THUS, HE DID NOT FIND THESE GIFTS AS GENUINE AND MA DE ADDITION U/S. 68 OF THE IT ACT OF RS.24,94,179/-. ITA NOS. 2754 & 2656/AHD/2010 A.Y. 07-08 PAGE 3 3. BEING AGGRIEVED BY THE ORDER OF THE A.O., THE AS SESSEE CARRIED THE MATTER BEFORE THE CIT(A) WHO HAS PARTLY CONFIRMED T HE ADDITION BY OBSERVING AS UNDER: 6. AFTER GOING THROUGH RIVAL SUBMISSIONS IT IS SEE N THAT VARIOUS AMOUNTS WERE RECEIVED FROM AUGUST 2006 TO NOVEMBER 2006 BY THE APPELLANT FROM HIS SISTER SMT. ASMITA NILESBHAI SON I TOTALING TO RS.24,94,179/-. THESE AMOUNTS WERE ISSUED THROUGH CHEQUES BY SMT. ASMITA N SONI FROM HER BANK ACCOUNTS NAMELY FL EET WOODBRIDGE AT NEW JERSEY AND FROM HER BANK ACCOUNT AT BANK OF AMERICA, WILLINGBORD BRANCH. DURING THE COURSE OF APPELLATE PROCEEDINGS TRANSACTIONS FROM BANK STATEMENT OF THE DONOR AT FLEET WOODBRIDGE BANK WERE GOT TALLIED / MATCHED WITH THE DETAILS OF GIFTS MENTIONED IN THE GIFT DEED, BUT BANK STATEMENT OF T HE DONOR MAINTAINED WITH BANK OF AMERICA, WILLINGBORD WAS NO T FILED BEFORE THE AO AND NEITHER DURING THE COURSE OF APPELLATE P ROCEEDINGS, THEREFORE TWO GIFTS OF $ 9,000 EACH WHICH COME TO R S.4,03,230 PLUS RS.4,03,230 AS PER TABLE GIVEN ON PAGE 5 OF THE ASS ESSMENT ORDER COULD NOT BE GOT CONFIRMED / ESTABLISHED BY THE ID. ARS, THEREFORE ADDITION OF RS.8,06,460 OUT OF GIFT ADDED U/S.68 OF RS. 24,94,179 IS UPHELD AND BALANCE ADDITION IS DELETED. ON ONE HAND THE ID. ARS ARE ABLE TO FILE COPY OF PASSPORT, SOCIAL SECURITY NUMB ER OF THE DONOR ALSO HER COPY OF BANK ACCOUNT MAINTAINED WITH FLEET WOOD BRIDGE BUT ON THE OTHER HAND WITHOUT EXPLAINING ANY REASON JUST K EEP SILENT ABOUT DONOR'S BANK ACCOUNT MAINTAINED IN BANK OF AMERICA, COPY OF WHICH WAS NEITHER FILED IN ASSESSMENT NOR IN APPELLATE PR OCEEDINGS. FOR UPHOLDING THE ADDITION OF RS.8,06,460 RELIANCE IS P LACED ON HON'BLE SUPREME COURT DECISION IN THE CASE OF CLT V P. MOHA NKALA (2007) 291ITR 278 WHEREIN IT HAS BEEN HELD THAT THE INFERE NCE OF GIFT DOES NOT READILY FOLLOW MERELY ON IDENTIFICATION OF THE DONOR ON RECEIPT OF MONEY THROUGH BANKING CHANNELS. RELIANCE IS ALSO PL ACED ON ITA NOS. 2754 & 2656/AHD/2010 A.Y. 07-08 PAGE 4 DECISIONS OF HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SUBHASH CHANDER SEKHRI V. DCIT (2007) 290 ITR 300( P & H ) AND JASPAL SINGH V. CLT (2007 ) 290 ITR 306 ( P & H ) W HEREIN IT HAS BEEN HELD THAT BURDEN OF PROVING THE GIFT TO BE GEN UINE IS ON THE TAX PAYER. 4. NOW THE REVENUE AS WELL AS ASSESSEE IS BEFORE US . LD. SR. D.R. ARGUED THAT NO RELATION HAS BEEN ESTABLISHED BY THE APPELLANT WITH THE DONOR. THE COPY OF BANK ACCOUNT OF AMERICAN BANK HAD NOT B EEN SUBMITTED BEFORE THE LOWER AUTHORITIES AND HE HEAVILY RELIED UPON TH E ORDER OF THE A.O. AND PRAYED TO CONFIRM THE ADDITION. HOWEVER, LD. A.R. FOR THE APPELLANT ARGUED THAT THE ASSESSEE HAD PROVED THE GENUINENESS OF THE GIFT BY FURNISHING THE COPY OF GIFT DEED FOR ALL THE GIFTS, COPY OF BANK ACCOUNT, RELATIONSHIP, COPY OF PASSBOOK AND COPY OF AMERICAN BANK ACCOUNT FROM WHERE SHE GA VE $ 9,000 /- EACH AS GIFT TO THE ASSESSEE. HE FURTHER RELIED UP ON CIT VS. HEENA SHARMA IN TAX APPEAL NO. 712 OF 2012 (GUJ.), CO-ORDINATE B BENCH, AHMADABAD, DECISION IN IT(SS)A NO. 197/AHD/2009 FOR A.Y. 2003-04 IN CASE OF SMT. HEENA SHARMA VS. ACIT & ITAT, DELHI A BENCH IN CASE OF ACIT VS. UJJAGAR SINGH OBEROI IN ITA NO. 1349 (DELHI) OF 2006 FOR A.Y. 200 1-02, DATE OF ORDER, SEPTEMBER 19,2008 AND ARGUED THAT IDENTICAL ISSUE H AS BEEN DECIDED BY THE HONBLE COURTS IN FAVOUR OF THE ASSESSEE. THUS, HE REQUESTED TO DELETE THE ADDITION CONFIRMED BY THE CIT(A) BUT ALSO DISMISS T HE REVENUES APPEAL. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. HONBLE GUJARAT HIGH COURT IN CASE OF CIT VS. HEENA SHARMA (SUPRA) IN IDENTICAL CASE HAS HELD AS UNDER: ITA NOS. 2754 & 2656/AHD/2010 A.Y. 07-08 PAGE 5 14. WE ARE CONSCIOUS THT VARIOUS ASPECTS DISCUSSED BY BOTH THE ASSESSING OFFICER AND CIT(A) WERE CAUSING CONCERN T O THOSE AUTHORITIES. GIFTS TO ASSESSEE BY 11 DIFFERENT UNR ELATED PERSONS, RESIDING AT DIFFERENT PLACES IN MUMBAI ON THE SAME DAY, WITH THE DRAFT OF HUGE SUM FROM THE SAME BANK AND DEPOSIT WI THIN A SPAN OF 2 TO 3 DYAS WOULD RAISE THE EYEBROWS. THEIR NON REPL Y OF LETTER UNDER SECTION 133(6) AND NON APPEARANCE OF ASSESSEE PERSO NALLY MAY FURTHER STRENGTHEN SUCH SUSPICION COUPLED WITH DIFF ERENCE IN ECONOMIC STRATA OF ASSESSEE AND THAT OF THESE PERSO NS. YET, THESE QUESTIONS DO NOT CROSS THE REALM OF SUSPICION TO EN TER THE SPHERE OF PROOF, LET ALONE THE ARENA OF CONVINCING EVIDENCE. TRIBUNAL COULD WITH THE AID OF COGENT REASONINGS CONVINCE US WHY S UCH MATERIAL PROOF WAS SUFFICIENT TO ACCEPT THE VERSION OF ASSES SEE AND UPHOLD HIS REQUEST TO DELETE THE ADDITION OF ENTIRE AMOUNT FROM THE COMPUTATION OF HIS INCOME. 15. WE FIND NO PERVERSITY IN SUCH CONCLUSION SO AS TO HOLD THAT THIS GIVES RISE TO ANY QUESTION OF LAW MUCH-LESS ANY SUB STANTIAL QUESTION OF LAW. THE SIMILAR VIEW ALSO HELD BY ITAT, DELHI A BENCH IN CASE OF ACIT VS. UJJAGAR SINGH OBEROI(SUPRA), WHEREIN IT HAS BEEN HE LD AS UNDER: HELD THAT THE ASSESSING AUTHORITY HAD NOT USED ANY OF HIS POWERS TO VERIFY THE GENUINENESS OF THE CLAIM OF THE ASSESSEE BY VERIFYING THE CORRESPONDENCE WITH THE DONOR, IF THE ASSESSING AUT HORITY HAD DOUBTED THE TRANSACTION OF THE GIFTS, AFTER RECEIVI NG THE EVIDENCE WHICH HAD BEEN PRODUCED BY THE ASSESSEE IN SUPPORT OF ITS CLAIM. AFTER CONSIDERING THE EVIDENCE BEING THE CORROBORAT IVE EVIDENCE PRODUCED IN THE FORM OF FURTHER CORRESPONDENCE AND THE RETURNS OF THE DONORS, THE COMMISSIONER (APPEALS) HAD DELETED THE ADDITION. IN THE CIRCUMSTANCES, IN THE ABSENCE OF ANY EVIDENC E OR SUBMISSIONS TO SHOW THAT THE FINDING OF THE COMMISSIONER (APPEA LS) WAS PERVERSE OR HAD BEEN ARRIVED AT ON A WRONG APPRECIA TION OF FACT, THE ITA NOS. 2754 & 2656/AHD/2010 A.Y. 07-08 PAGE 6 FINDING OF COMMISSIONER (APPEALS) IN DELETING THE A DDITIONS MADE ON ACCOUNT OF THE GIFTS RECEIVED BY THE ASSESSEE WAS L IABLE TO BE SUSTAINED. THE FACTS OF ABOVE CASE LAWS ARE IDENTICAL TO THE C ASE OF THE ASSESSEE. THE DONOR IS LIVING IN USA FILING INCOME TAX RETURN THE RE WHO HAS AUTHENTICATED THE GIFT IN GIFT DEEDS. PAYMENTS WERE RECEIVED THROUGH CHEQUES, COUNTER CREDIT IN USA HAS NOT BEARING IN INDIA. THERE IS NO EVIDENCE ON RECORD THAT THE ASSESSEES MONEY HAS BEEN ROUTED THROUGH THESE GIFT S. THUS, WE ALLOW THE ASSESSEES APPEAL AND DISMISS THE REVENUES APPEAL. 6. IN THE COMBINED RESULT, THE REVENUES APPEAL IS DISMISSED AND THE ASSESSEES APPEAL IS ALLOWED. THESE ORDERS PRONOUNCED IN OPEN COURT ON 27.09.2013 SD/- SD/- ( MUKUL KR. SHRAWAT ) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. / ASSESSEE 3. $%$& ' '( / CONCERNED CIT 4. ' '(- + / CIT (A) 5. -.+' &, ' ++' &, 01 % / DR, ITAT, AHMEDABAD 6. .34 56 / GUARD FILE. BY ORDER/ , 7/0' $+ ' ++' &, 01 % 9