PARESH RAYASHI GALA, THANE V. ITO WD 3(3), THANE

ITA 4578/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87930 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 31-12-2014
• Assessment Year: 2003-2004
• Appeal Filed On: 10-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEIL PHLIP
• Assessee Lawyers: SUBODH RATNAPARAKHI
• Keywords: Gift
• Section: 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI BEFORE HONBLE S/SHRI H.L. KARWA, PRESIDENT AND B. R.BASKARAN (AM) . . , . . , ./ I.T.A. NO.4578/MUM/2013 ( / ASSESSMENT YEAR :2003-04) PARESH RAYASHI GALA, A/11, SHARDA KUNJ BUILDING, 4 TH FLOOR, HDFC BANK, DR.MOOSE ROAD, TALAOPALI, THANE(W)-400601 / VS. INCOME TAX OFFICER, WARD 3(3), ASHAR I T PARK, 6 TH FLOOR, B WING, ROOM NO.22, ROAD NO.16Z, WAGLE INDUSTRIAL ESTATE, THANE-400604 ( / APPELLANT) .. ( ! / RESPONDENT) ./ #$ ./ PAN/GIRNO.:AGBPG3867A % / ASSESSEE BY : SHRI SUBODH RATNAPARAKHI ! & % /RESPONDENT BY : SHRI NEIL PHLIP. ' ( & ) * / DATE OF HEARING : 31.12.2014 +, & ) * /DATE OF PRONOUNCEMENT : 07.01.2015 / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 28.01.2013 PASSED BY LD CIT(A)-I, THANE AND IT RELATES TO THE ASSESSMENT YEAR 2003-04. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD CIT (A) IN CONFIRMING THE ASSESSMENT OF CASH CREDIT OF RS.5.00 LAKHS U/S 68 O F THE ACT. 2. THE LD COUNSEL APPEARING FOR THE ASSESSEE SUBMIT TED THAT THE ASSESSEE HAD RECEIVED A SUM OF RS.5.00 LAKHS BY WAY OF GIFT FROM A PERSON NAMED SHRI MAHESH ASWANI. THE ASSESSING OFFICER HAD ASSESSED THE SAME AS CASH CREDIT U/S 68 OF THE ACT. WHEN THE MATTER REACHED THE ITA T, THE TRIBUNAL RESTORED THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER WI TH THE DIRECTION TO THE AO TO GIVEN ONE MORE OPPORTUNITY TO THE ASSESSEE TO PRODU CE SHRI MAHESH ASWANI BEFORE HIM IN ORDER TO PROVE THE GIFT RECEIPT. THE LD COUNSEL SUBMITTED THAT THE ITA NO.4578/M/13 2 DONOR SRI MAHESH ASWANI, IN THE MEAN TIME, HAD MIGR ATED TO DUBAI AND HENCE THE ASSESSEE COULD NOT PRODUCE HIM BEFORE THE AO DU RING THE COURSE OF SET ASIDE PROCEEDINGS. HOWEVER, THE DONOR SUBMITTED AN AFFID AVIT GIVEN BY HIM BEFORE THE CONSULATE GENERAL OF DUBAI, COPY OF HIS PASS PORT, RELEVANT BANK STATEMENTS DIRECTLY TO THE ASSESSING OFFICER IN ORDER TO CONFI RM THE FACTUM OF GIVING OF GIFT AMOUNT. HOWEVER THE AO REJECTED THEM ON THE SOLE G ROUND THAT THE ASSESSEE HAS FAILED TO PRODUCE THE DONOR BEFORE HIM AS PER T HE DIRECTIONS OF ITAT. THE LD CIT(A) ALSO CONFIRMED THE SAME FOR IDENTICAL REASON S. 3. THE LD COUNSEL FURTHER SUBMITTED THAT THE ABO VE SAID DONOR HAD ALSO GIVEN GIFTS TO ANOTHER PERSON NAMED SHRI KRISHNAKUM AR K ASHAR. THE ASSESSING OFFICER OF THE ABOVE SAID PERSON ALSO ASSESSED THE GIFTS U/S 68 OF THE ACT AND THE SAME WAS ALSO CONFIRMED BY THE LD CIT(A) IN THE APP EAL FILED BY SHRI KRISHNAKUMAR K ASHAR. IN FACT, IN THE ORIGINAL ASS ESSMENT PROCEEDINGS, THE AO HAD FOLLOWED THE DECISION TAKEN IN THE CASE OF SHRI KRISHNAKUMAR K ASHAR FOR ASSESSING THE GIFT AMOUNT OF RS.5.00 LAKHS IN THE H ANDS OF THE ASSESSEE. THE LD COUNSEL SUBMITTED THAT SHRI KRISHNAKUMAR K ASHAR HA D FILED APPEAL BEFORE ITAT AND THE TRIBUNAL HAS, HOWEVER, DELETED THE ADDITION MADE U/S 68 OF THE ACT, VIDE ITS ORDER DATED 21-02-2008 PASSED IN ITA NO.9355/MU M/2004 PASSED IN THE HANDS OF SHRI KRISHNAKUMAR K ASHAR. 4. ACCORDINGLY, THE LD A.R SUBMITTED THAT THE ASS ESSEE HAD, IN FACT, DISCHARGED THE INITIAL BURDEN PLACED UPON HIM U/S 6 8 OF THE ACT FOR PROVING THE GIFT RECEIVED BY HIM. HE SUBMITTED THAT THE ASSESSEE CO ULD NOT PRODUCE THE DONOR BEFORE THE ASSESSING OFFICER FOR THE REASONS BEYOND HIS CONTROL AND THE SAME ALSO BEEN DULY EXPLAINED. ACCORDINGLY, HE SUBMITTE D THAT THE TAX AUTHORITIES ARE NOT JUSTIFIED IN REJECTING THE EXPLANATIONS AND ALS O THE INABILITY OF THE ASSESSEE IN THIS REGARD. 5. ON THE OTHER HAND, THE LD D.R SUBMITTED THAT THE ASSESSEE HAS FAILED TO PRODUCE THE DONOR AS PER THE DIRECTIONS OF THE TRIB UNAL. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUS ED THE RECORD. AS NOTICED EARLIER, THE TRIBUNAL HAD RESTORED THE MATTER TO TH E FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO THE ASSESSING OFFICER TO GIVE ONE MORE OPPORTUNITY TO THE ITA NO.4578/M/13 3 ASSESSEE TO PRODUCE THE DONOR BEFORE HIM FOR EXAMIN ATION. THE TRIBUNAL HAD FURTHER OBSERVED THAT THE AO SHALL DECIDE THE ISSUE AFRESH AND IN ACCORDANCE WITH LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEAR D TO THE ASSESSEE. THUS, IT IS SEEN THAT THE TRIBUNAL HAS GIVEN OPEN HAND TO THE A SSESSING OFFICER AND IN OUR VIEW, IT CANNOT BE CONSIDERED AS A CASE OF GIVING D IRECTION TO THE ASSESSEE TO PRODUCE THE DONOR. 7. IN THE INSTANT CASE, IT IS NOTICED THAT THE DO NOR HAD MIGRATED TO DUBAI AND HENCE HE COULD NOT APPEAR BEFORE THE ASSESSING OFFI CER IN PERSON. HENCE, THERE IS MERIT IN THE SUBMISSION OF THE ASSESSEE THAT IT WAS BEYOND HIS CONTROL TO PRODUCE THE DONOR UNDER THE ABOVE SAID CIRCUMSTANCE S. HENCE, THE ASSESSEE HAS PERSUADED THE DONOR TO GIVE NECESSARY DOCUMENTS TO THE ASSESSING OFFICER TO PROVE THE FACTUM OF GIVING OF GIFT. ACCORDINGLY, T HE DONOR HAS WRITTEN A LETTER DIRECTLY TO THE AO CONFIRMING THE PAYMENT OF GIFT A LONG WITH AN AFFIDAVIT DEPOSED BEFORE THE CONSULATE GENERAL OF DUBAI, HIS PASS POR T, HIS BANK STATEMENTS IN DUBAI AND THE COPY OF RELEVANT BANK ACCOUNT, WHERE FROM THE GIFT WAS GIVEN TO THE ASSESSEE. THUS, THE IDENTITY OF THE DONOR STAN DS PROVED. WE NOTICE THAT THE DONOR HAS GIVEN THE IMPUGNED GIFT FROM OUT OF CURRE NT ACCOUNT MAINTAINED IN THE NAME OF M/S DEVIOUS EXPORTS. HENCE THE GENUINENESS OF TRANSACTION ALSO STANDS PROVED. A PERUSAL OF THE SAID BANK ACCOUNT WOULD SHOW THAT THE DONOR HAD RECEIVED EXPORT RELATED AMOUNT OF RS.24.44 LAKH S ON 15.05.2002 AND HE HAS USED THE SAME FOR GIVING IMPUGNED GIFT TO THE ASSES SEE. THUS, IT IS SEEN THAT IT WAS NOT A CASE OF DEPOSITING OF CASH INTO THE BANK ACCOUNT BEFORE GIVING GIFT. WE FURTHER NOTICE THAT THE DONOR, IN HIS DECLARATION D ATED 14.05.2002, HAS STATED THAT HE WAS ASSESSED TO INCOME TAX UNDER PAN NO.AAFPA474 0C. HENCE, IN OUR VIEW, THE CREDIT WORTHINESS OF THE DONOR ALSO STAND S PROVED. 8. WE NOTICE THAT THE ASSESSEE HAS PROVED THE IDEN TIFY OF THE DONOR, GENUINENESS OF TRANSACTION AND THE CREDIT WORTHINES S OF THE DONOR. THOUGH THE DONOR HAS FAILED TO FURNISH THE OCCASION ON WHICH T HE GIFT WAS GIVEN, YET WE ARE OF THE VIEW THAT, IN THE FACTS AND CIRCUMSTANCES PREVA ILING IN THE INSTANT CASE, THERE IS NO REASON TO SUSPECT THE GENUINENESS OF THE CLAI M. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND DIRECT THE AO TO DELETE THE ASSESSMENT OF GIFT AMOUNT OF RS.5.00 LAKHS MADE U/S 68 OF THE ACT. ITA NO.4578/M/13 4 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSE E IS ALLOWED. THE ABOVE ORDER WAS PRONOUNCED IN THE OP EN COURT ON 7TH JAN,2015 . +, ' - ./ 0 1 7TH JAN 2015 , & 2( 3 SD SD ( . . / H.L. KARWA) ( . . , / B.R. BASKARAN ) / PRESIDENT / ACCOUNTANT MEMBER . ' ( MUMBAI: 7TH JAN, 2015. . . ./ SRL , SR. PS ! ' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. ! / THE RESPONDENT. 3. ' 7) ( ) / THE CIT(A)- CONCERNED 4. ' 7) / CIT CONCERNED 5. 6. 89 2 ): , * : , . ' ( / DR, ITAT, MUMBAI CONCERNED 2 ; < ( / GUARD FILE. = ' / BY ORDER, TRUE COPY > # (ASSTT. REGISTRAR) * : , . ' ( /ITAT, MUMBAI