Dipaliben Sanjaykumar Lumbhani, RAJKOT-GUJARAT V. The Income Tax Officer, Ward-5(1), RAJKOT-GUJARAT

ITA 389/RJT/2012

• Counselvise Citation: [2012] 120 COUNSELVISE.COM (IT) 0124 (ITAT-RAJKOT)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 04-12-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 12-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANKUR GARG D R
• Assessee Lawyers: DR ADHIA
• Keywords: Gift; Opportunity of being heard

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBULAL; RAJKOT BENCH, RAJKOT. BEFORE SHRI T. K. SHARMA JM AND SHRI B. R. JAIN AM ITA NO.389/RJT/2012 / ASSESSMENT YEAR 2006-07. DIPALIBEN SANJAYKUMR LUMBHANI, 2-VARDHMANNAGAR, SONA RUPA, PALACE ROAD, RAJKOT. PAN : ABGPL5531N ( / APPELLANT V/S THE I. T. O, WARD-5(1), RAJKOT. / RESPONDENT ITA NO.390/RJT/2012 / ASSESSMENT YEAR 2006-07. DEEPABEN JIGNESHKUMR LUMBHANI, 2-VARDHMANNAGAR, SONA RUPA, PALACE ROAD, RAJKOT. PAN : ABGPL5532R ( / APPELLANT V/S THE I. T. O, WARD-5(1), RAJKOT. / RESPONDENT / ASSESSEE BY SHRI D. R. ADHIA, A. R. # / REVENUE BY SHRI ANKUR GARG, D.R. & / DATE OF HEARING 04-12-2012 & / DATE OF PRONOUNCEMENT 04 - 12-2012 / / / / ORDER B. R. JAIN, A. M. : THESE TWO APPEALS BY THE ASSESSEES AGAINST THE O RDERS DATED 22-03-2012 OF LEARNED CIT(A)-IV, RAJKOT IN VA RIOUS GROUNDS CHALLENGE THE ADDITION OF RS.6,00,000/- CLAIMED TO HAVE BEEN RECE IVED AS GIFT FROM THE SISTER OF MOTHER-IN-LAW BY IGNORING THE EXEMPTION CONTAINED U NDER EXPLANATION BELOW SEC.56(2)(VI) OF THE ACT, READ WITH CLAUSES (III) A ND (VII) CONTAINED THEREUNDER. ITA 389 & 390/RJT/2012 2 2. THE ASSESSEES CASE IN ITA NO.390/RJT/2012 IS TH AT SHE RECEIVED A GIFT OF RS.6,00,000/- FROM THE SISTER OF HER MOTHER-IN-LAW (MASIJI) STAYING AT LEICESTER, U.K. THE TERM MASIJI I.E. SISTER OF HER MOTHER-IN- LAW IS A SISTER OF MOTHER OF HER HUSBAND. THE GIFT RECEIVED THROUGH THE TRANSACTION IS FOUND FULLY IN ORDER. THE LD. A.O., HOWEVER, CAME TO THE CONCLUSION THAT THE SAME IS TAXABLE AS MASIJI CAN NOT BE CONSIDERED AS A RELATIVE, AS MENTIONED IN PA RA 3.1, 3.2 AND 3.3 OF THE ASSESSMENT ORDER. IT IS FURTHER SUBMITTED THAT PRO VISIONS OF SECTION 56(2)(VI) HAS BEEN DISCUSSED IN DETAIL CONTAINED IN ANNEXURE WHIC H PROVIDES AT (J) SISTER OF MOTHER OF THE INDIVIDUAL AND AT (Q) WIFE OR HUSBAND OF THE RELATIVES. THUS, IT IS AMPLY CLEAR THAT SISTER OF MOTHER OF THE SPOUSE OF THE INDIVIDUAL, KNOWN AS MASIJI IS ALSO INCLUDED WITHIN THE TERM RELATIVES A ND THEREFORE NO ADDITION IN RESPECT OF THIS OUGHT TO HAVE BEEN MADE BY THE LD. A.O. THE ASSESSEE ALSO CONTENDED THAT BHABHI, MASI, TAI, AUNTY, MAMI ALL ARE CONSIDERED AS RELATIVES SINCE THE SAME ARE OF RELATIVE OF EITHER HUSBAND OR WIFE AND THEREFORE TO THE OTHER SPOUSE ARE ALSO CONSIDERED AS RELATIVES AND HENCE G IFT RECEIVED FROM ANY OF THEM IS EXEMPT. THE ADDITION MADE IN THIS ASPECT MAY KI NDLY BE DELETED. 3. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPR ESENTATIVE SUPPORTING THE DECISION OF AUTHORITY BELOW CONTENDED THAT THE ASSESSEE FIRSTLY HAS NOT LED ANY MATERIAL ON RECORD TO SUBSTANTIATE THE FACT THA T THE DONOR IS A SISTER OF HER MOTHER-IN-LAW. EVEN IF IT IS ESTABLISHED THAT SHE RECEIVED GIFT FROM THE SISTER OF HER MOTHER-IN-LAW, THE SAME DOES NOT CONSTITUTE A RELATIVE WITHIN THE MEANING OF SECTION 56(2)(VI) OF THE ACT AND THE RELIANCE PLACE D ON CLAUSES (J) & (Q) AS AMPLIFIED IN THE ANNEXURE SUBMITTED BY THE APPELLAN T, THE SAME DOES NOT APPLY TO THE PRESENT FACTS OF THE CASE AS THE WORDS BROTHER OR SISTER OF EITHER OF THE PARENTS OF THE INDIVIDUALS DO NOT REFER TO THE IN-L AWS. THE TERM PARENTS HAS TO BE VIEWED IN THE CONTEXT OF THE ASSESSEE AND THE SAME WILL NOT INCLUDE THE PARENTS OF THE SPOUSE. SECONDLY, AS PER CLAUSE (VII) BELOW THE EXPLANATION TO SEC.56(2), SPOUSE OF THE PERSON REFERRED TO IN CLAUSES (II) TO (VI) QUALIFIES ONLY THE PERSONS MENTIONED IN CLAUSES I.E. BROTHER AND BROTHERS WIF E OF THE PARENTS OF THE INDIVIDUALS AND SISTER AND SISTERS HUSBAND OF THE PARENTS OF THE INDIVIDUALS. THIS ITA 389 & 390/RJT/2012 3 WILL NOT APPLY TO THE BROTHER OR SISTER OF THE PARE NTS OF THE SPOUSE AS THERE IS A MATERIAL DIFFERENCE IN THE CONTEXTUAL MEANING OF WO RDS PARENTS AND PARENT-IN-LAW. THERE IS THUS NO MERIT IN THE GROUNDS RAISED IN APP EAL BY THE ASSESSEE. 4. HEARD PARTIES WITH REFERENCE TO MATERIAL ON RECO RDS. THE ASSESSING OFFICER HAS NOT FOUND AS A MATTER OF FACT AS TO WHE THER THE DONOR IS A SISTER OF MOTHER-IN-LAW OF THE APPELLANT. UNLESS THE SAID FI NDING IS REACHED, IT SHALL NEITHER BE PROPER NOR RELEVANT TO DELVE DEEP WITHIN THE DEF INITION OF RELATIVE FOR THE PURPOSE OF SECTION 56(2)(VI) OF THE ACT. WE THEREF ORE, SET ASIDE THE ADDITION AND REMAND THE MATTER BACK TO THE ASSESSING OFFICER FOR RECORDING A FINDING OF FACT AS TO WHETHER THE DONOR IS A SISTER OF MOTHER-IN-LAW O F THE APPELLANT AND IF, IT IS, SO FOUND THEN HE SHALL EXAMINE THE DEFINITION OF RELAT IVE AS IS CONTAINED IN EXPLANATION BELOW SECTION 56(2)(VI) OF THE ACT AND DECIDE ISSUE IN ACCORDANCE WITH LAW. NEEDLESS TO ADD A REASONABLE AND EFFECTIV E OPPORTUNITY OF BEING HEARD SHALL BE ALLOWED TO THE ASSESSEE BEFORE TAKING DECI SION IN ACCORDANCE WITH LAW. 5. SINCE THE FACTS IN ITA NO.389/RJT/2012 ARE CLAIM ED TO BE IDENTICAL, FOR PARITY OF REASONS AS ARE CONTAINED IN PARA-5 OF ITA NO.390/RJT/2012 HEREINABOVE, THE ISSUE IN THIS CASE ALSO SHALL BE EXAMINED AND D ECIDED AFRESH ACCORDINGLY. 6. IN THE RESULT, BOTH THE APPEALS STAND ALLOWED FO R STATISTICAL PURPOSES ONLY. ORDER IS PRONOUNCED IN THE PRESENCE OF PARTIES IMM EDIATELY AFTER CONCLUSION OF HEARING ON 04-12-2012. SD/- SD/- ( T. K. SHARMA ) ( B. R . JAIN ) # /JUDICIAL MEMBER # / ACCOUNTANT MEMBER +/ ORDER DATE 04-12-2012. /RAJKOT NVA/- - - - - .- .- .- .- / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-DIPABEN SANJAYKUMAR LUMBHANI, RAJKOT. ITA 389 & 390/RJT/2012 4 2. / RESPONDENT-THE INCOME-TAX, WARD-5(1), RAJKOT. 3. 4 / CIT-III, RAJKOT. 4. 4- / CIT (A)-IV, RAJKOT. 5. - , , / DR, ITAT, RAJKOT 6. / GUARD FILE. / BY ORDER , TRUE COPY. SENIOR PRIVATE SECRETARY, , INCOME TAX APPELLATE TRIBUNAL, RAJKOT.