NILESH JHAVERI (HUF), MUMBAI V. ITO 21(1)(3), MUMBAI

ITA 4980/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3417 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 31-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHIVAJI B GHODE
• Keywords: Unexplained cash credit; Gift
• Section: 68; 56

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI B BENCH, MUMBAI BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER. ITA. NO. 4980/MUM/2014 (ASSESSMENT YEAR:2006-07) NILESH JHAVERI (HUF), SMRUTI BUILDING, 4 TH FLOOR, PLOT NO.16, ROAD NO.5, JVPD SCHEME, VILE PARLE (WEST), MUMBAI 400 056 APPELLANT VS. INCOME TAX OFFICER, RANGE - 21(1)(3), BANDRA, MUMBAI RESPONDENT PAN: AABHN9038C /BY APPELLANT : SHRI VIJAY MEHTA, A.R. /BY RESPONDENT : SHRI SHIVAJI B. GHODE, D.R. /DATE OF HEARING : 04.08.2016 /DATE OF PRONOUNCEMENT : 19.08.2016 ORDER PER SHAILENDRA KUMAR YADAV, J.M: THIS APPEAL HAS BEEN FILED BY ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME-TAX (APPEALS)-32, MUMBAI, DA TED 04.07.2014 FOR A.Y. 2006-07 ON FOLLOWING GROUNDS: ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 2 1. THE LEARNED CIT (A) HAS ERRED IN LAW AND IN F ACTS IN CONFIRMING THE ADDITION OF INCOME OF RS.68,66,375/- BEING GIFT OF INDIA MILLENNIUM DEPOSIT RECEIVED AS UNEXPLAINED CREDIT UNDER SECTION 68 OF THE I. T. AC T, 1961. 2. IT IS RESPECTFULLY SUBMITTED THAT PROCEEDS OF IN DIA MILLENNIUM DEPOSIT CASH NOT BE BROUGHT TO TAX IN TH E HANDS OF APPELLANT BY INVOKING PROVISIONS OF SECTIO N 56(2)(V) OF THE I.T. ACT, 1961. 2. THE MAIN ISSUE IN THIS APPEAL IS WITH REGARD TO ADDITION OF RS.68,66,375/- ON ACCOUNT OF GIFT RECEIVED BY ASSES SEE OF INDIAN MILLENNIUM DEPOSIT (HEREINAFTER CALLED AS I MD) BOND. THE DEPOSIT OF IMD BOND TO THE EXTENT OF RS.68,66,3 78/- IN THE BANK ACCOUNT OF ASSESSEE WERE SHOWN AS GIFT RECEIVE D AND THE SAME WERE CLAIMED AS EXEMPT UNDER THE PROVISIONS OF SECTION 10(15)(IID)(C) OF THE ACT. ASSESSING OFFICER DURIN G COURSE OF ASSESSMENT PROCEEDINGS ASKED THE ASSESSEE TO FURNIS H NECESSARY EVIDENCES TO ESTABLISH THE GENUINENESS OF TRANSACTIONS, IDENTITY AND CREDITWORTHINESS OF THE DONOR. ASSESSING OFFICER ALSO ASKED TO GIVE DETAILS OF GIF T RECEIVED AND TAXABILITY OF THE SAME IN VIEW OF THE PROVISIONS OF SECTION 56 OF THE ACT. 2.1 ASSESSING OFFICER STATED THAT ON THE REVERSE BO TTOM OF IMD CERTIFICATES THERE WAS MEMORANDUM OF TRANSFER, WHIC H WAS IDENTICAL IN ALL THE CERTIFICATES. AS PER SUCH MEMO RANDUM OF TRANSFER, THE IMDS WERE TRANSFERRED IN THE NAME OF SHRI SUNIL KUMAR K GANDHI ON 30.08.2004 AND WERE SUBSEQUENTLY ENDORSED IN THE NAME OF ASSESSEE ON THE NEXT DAY I. E. 31.08.2004. ASSESSING OFFICER IN ORDER TO ASCERTAI N THE DATE OF ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 3 TRANSFER TO SHRI SUNIL KUMAR K GANDHI AND SUBSEQUEN TLY TO THE ASSESSEE, CALLED INFORMATION FROM THE SBI, NRI BRANCH MUMBAI. AS PER THE INFORMATION RECEIVED FROM THE BA NK, THE DATE OF TRANSFER OF IMDS TO SHRI SUNIL KUMAR GANDHI WERE 15.09.2004 AND 23.10.2004 AND SUBSEQUENTLY TO THE A SSESSEE WAS ON 26.09.2005. ASSESSING OFFICER ACCORDINGLY O BSERVED THAT THE DATE OF TRANSFER SHOWN BY ASSESSEE WAS NOT IN CONNECTION WITH THE DATE OF TRANSFER AS RECORDED IN THE STATE BANK OF INDIA. HE OBSERVED THAT THE CERTIFICATES WE RE NOT EVEN TRANSFERRED FROM THE FIRST HOLDER TO SHRI GANDHI TI LL 31.08.2004 AND THAT UNDER THESE FACTS THE TRANSFER IN THE NAME OF ASSESSEE COULD ONLY BE SUBSEQUENT TO THE DATE OF FIRST TRANS FERS IN THE NAME OF SHRI GANDHI WHICH WERE 15.09.2004 AND 23.10 .2004. TAKING ALL FACTS AND CIRCUMSTANCES INTO CONSIDERATI ON, ASSESSING OFFICER AFTER REJECTING THE CONTENTION OF ASSESSEE RULED OUT THAT PROVISIONS OF SECTION 56(2)(V) OF TH E ACT WERE NOT APPLICABLE IN THE CASE OF ASSESSEE. ASSESSING OFFI CER SUBSEQUENTLY ISSUED A SHOW CAUSE NOTICE TO ASSESSEE PROPOSING TO ADD THE AMOUNT OF RS.68,66,378 U/S.56(2)(V) OF T HE ACT. ASSESSING OFFICER OBSERVED THAT THE CONTENTION OF A SSESSEE WAS THAT IMDS WERE RECEIVED ON 31.08.2004 WERE NOT ACCE PTABLE AS INFORMATION FROM THE BANK HAS ESTABLISHED THAT THE DATE OF TRANSFER OF IMDS WERE 26.09.2005. ASSESSING OFFICER FURTHER UNDER THE CAPTIONS IMD'S NOT BEING ANY SUM OF MONE Y', TAXABILITY OF INTEREST AMOUNTING TO RS. 23,65,467/- OF IMD'S, GENUINENESS OF GIFT, DISCUSSED THE FACTS OF THE CAS E AND POINTED OUT TOWARDS AND OBSERVED THAT RS. 68,66,378/- WAS T O BE TAXED ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 4 AS SUM RECEIVED DURING THE YEAR NOT ALLOWABLE AS EX EMPT UNDER THE PROVISIONS OF SECTION 56(2)(V) OF THE ACT, SINC E THE SAME IS FROM NON RELATIVE AND ALSO THE SAME IS GIVEN AND RE CEIVED AFTER FIRST DAY OF SEPTEMBER 2004. HE FURTHER OBSERVED TH AT EXEMPTION CLAIMED BY ASSESSEE OF INTEREST EARNED ON THE BONDS UNDER THE PROVISIONS OF SECTION 10(15) OF THE ACT W ERE NOT ALLOWED AS THE BONDS HAD BEEN GIFTED JUST PRIOR TO MATURITY AFTER LAPSE OF 57 MONTHS OUT OF 60 MONTHS OF SUCH B ONDS. ASSESSING OFFICER WITHOUT PREJUDICE TO THE ABOVE, M ENTIONED THAT EVEN IF FOR A BELIEF SAKE THE AMOUNT OF IMD GI FTED WAS IN ANY WAY BELIEVED TO BE OUTSIDE PURVIEW OF DEFINITIO N OF 'ANY SUM OF MONEY', THE WHOLE AMOUNT OF RS. 68,66,378/- NEEDED TO BE TAXED AS UNEXPLAINED CREDIT U/S.68 OF THE ACT FOR THE REASON OF THE SAME BEING IN THE NATURE OF HAWALA TR ANSACTION AND BROUGHT INTO THE BOOKS BY ASSESSEE FOR WHICH TH E ANTECEDENTS CANNOT BE PROVED TO BE LOVE AND AFFECTI ON BY THE DONOR. 2.2 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE A UTHORITY, WHEREIN VARIOUS CONTENTIONS WERE MAINLY RAISED WITH REGARD TO IMDS ARE NOT ANY SUM OF MONEY AND FURTHER, REGARDIN G GENUINENESS OF CREDITOR. ASSESSEE RAISED VARIOUS S UBMISSIONS AND CONSIDERING THE SAME, CIT(A) CONFIRMED THE ORDE R OF ASSESSING OFFICER. 2.3 SAME HAS BEEN OPPOSED BEFORE US ON BEHALF OF ASSESS EE INTER ALIA SUBMITTING THAT: ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 5 I. ASSESSEE HAS RECEIVED IMD AS GIFT OF IMD OF US$ 1,00,000/- ON 31.08.2004 FROM SHRI SUNIL KUMAR KHIMCHAND GANDHI AND NOT ON 26.09.2005 AS ALLEGED B Y THE ASSESSING OFFICER. II. IT WAS SUBMITTED THAT THESE IMDS WERE REPAID / MATURED ON 29.12.2005 AND THE ASSESSEE RECEIVED THE TOTAL A MOUNT OF RS.68,66,378/- ON MATURITY OF IMDS COMPRISING OF PRINCIPAL AMOUNT OF RS. 45,00,911/- AND INTEREST AM OUNT OF RS. 23,65,467/- AND THAT THE SAID AMOUNT WAS CLA IMED AS NON TAXABLE BY THE ASSESSEE. III. IT WAS FURTHER SUBMITTED THAT THE IMD CERTIFIC ATE IS NOT 'ANY SUM OF MONEY' AND THEREFORE IT WOULD NOT FALL WITHIN THE AMBIT OF SECTION 56(2)(V) R.W.S. 2(24)(XIII) OF THE ACT. IV. IT WAS FURTHER CONTENDED THAT GIFTS ARE GENUINE AS THE IDENTITY OF THE DONOR I.E. SHRI SUNIL KUMAR KHIMCHA ND GANDHI WAS PROVED THROUGH HIS INDIAN PASSPORT. IT W AS FURTHER SUBMITTED THAT ALTHOUGH HE RESIDES AT DUBAI HIS CAPACITY OF GIVING OF US$1,00,000/- IS PROVED. V. IT WAS FURTHER CONTENDED THAT CLOSE RELATIONSHIP BETWEEN DONORS' FAMILY AND DONEE'S FAMILY WAS PROVED BY PHOTOGRAPHS ON DIFFERENT FAMILY OCCASIONS. VI. IT WAS CONTENDED THAT INTEREST AMOUNT OF RS. 23 ,65,467/- IS EXEMPT U/S.10(15)(I) OF THE ACT. VII. IT WAS FURTHER SUBMITTED THAT THE COPIES OF IM DS CERTIFICATE CLEARLY REVEAL THAT THE DONOR WAS PREVI OUS HOLDER OF IMDS BEFORE PASSING THEM TO THE ASSESSEE BY WAY OF GIFT. ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 6 VIII. IT WAS ALSO SUBMITTED THAT THE DONOR SHRI SUN IL KUMAR K GANDHI WAS HAVING ANNUAL INCOME OF US$ 15,00,000/- AND THEREFORE THE GIFT OF US$ 1,00,000/- TO A CLOSE FAMILY FRIEND WAS NOT UNUSUAL. IX. THE CREDITWORTHINESS OF THE DONOR GOT PROVED AS THE DONOR WAS HOLDING IMDS FOR SUBSTANTIAL PERIOD. ASSESSEE ULTIMATELY CONTENDED THAT THE GENUINENESS OF THESE GIFTS OF IMD FROM CLOSE FAMILY FRIENDS NEED NOT BE DOUBTE D. X. TO PROVE THE CREDITWORTHINESS, ASSESSEE HAD SUBM ITTED NET WORTH CERTIFICATE OF SHRI SUNIL KUMAR KHIMCHAND GANDHI AND AFFIDAVIT CONFIRMING THE ABOVE FACTS. 2.4 IN THIS BACKGROUND, ASSESSEE REQUESTED TO DELET E ADDITION MADE BY ASSESSING OFFICER. TO STRENGTHEN ITS CONTE NTION, LD. AUTHORIZED REPRESENTATIVE ALSO RELIED ON THE DECISI ON OF ITAT, AGRA BENCH (THIRD MEMBER) IN CASE OF AVNISH KUMAR S INGH VS. ITO [2010] 126 ITD 145 (AGRA)(TM), WHEREIN THIRD ME MBER OBSERVED THAT IN THE INSTANT CASE, FOLLOWING FACTS WERE NOT IN DISPUTE: (A) THE IDENTITY OF THE DONOR WAS NOT IN DOUBT; (B) GIFT WAS GIVEN BY A DECLARATION DEED; (C) DONOR HAD GIVEN AN AFFIDAVIT AFFIRMING THE MAKI NG OF THE GIFT; (D) THERE WAS A CONFIRMATION THROUGH POST OF GIFT P ER DEMAND DRAFT; (E) AFFIRMATION OF THE ASSESSEE IN EXAMINATION ON O ATH RECORDED BY THE ASSESSING OFFICER; ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 7 (F) AFFIRMATION OF THE DONOR IN EXAMINATION ON OATH RECORDED; (G) DIRECT REPLY OF THE DONOR TO THE ASSESSING OFFI CER CONFIRMING THE GIFT; (H) DONOR WAS STATED TO BE A FRIEND OF THE ASSESSEE S FATHER; (I) DONOR WAS DOING SOME FINANCE BUSINESS; AND (J) SOURCE OF THE GIFT WAS THE RECEIPT THROUGH A CH EQUE OF RS.2,46,000 RECEIVED BY THE DONOR FROM B LTD. AND A CASH AMOUNT OF RS.3,500. 2.5 ALL THESE FACTS ESTABLISH THE FACT THAT A GIFT WAS RECEIVED BY ASSESSEE AND THE SOURCES THEREOF ARE SATISFACTORILY EXPLAINABLE AND PROVED PUTTING ITS GENUINENESS BEYOND DOUBT. TH E ADVERSE FACTS AS POINTED OUT BY THE ACCOUNTANT MEMBER: (I) THAT THE ASSESSEE OR HIS FATHER NEVER MADE ANY GIFT OF ANY AMOUNT TO ANYBODY; (II) THAT THE GIFT WAS NOT ON ANY OCCASION OR FUNC TION; (III) THAT THE DONOR VISITED HIS HOUSE ONE OR TWO TIMES THOUGH NEVER BEYOND THE DRAWING ROOM; (IV) THAT THE DONOR WAS A PERSON OF LOW FINANCIAL STATUS HAVING MONTHLY INCOME OF LESS THAN RS.5,000/- AND HAS SHOW N WITHDRAWALS FROM HIS CAPITAL ACCOUNT LESS THAN RS.3 ,000/- PER MONTH; (V) THAT THE DONOR HAS NO HOUSE, NO TELEPHONE NUMB ER, NO FIXED DEPOSIT AND NOT ANY OTHER IMMOVABLE ASSETS; O R THAT THE ORIGINAL DEPOSIT BY THE DONOR OF RS.1,25,000/- WITH B LTD. WAS NOT PROVED, WERE NOT SO MATERIAL TO HOLD T HE GIFT WAS NOT A GENUINE ONE OR SOURCES THEREOF UNSATISFAC TORY SO LONG AS THE IMMEDIATE SOURCE OF THE GIFT WAS ADM ITTEDLY ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 8 ESTABLISHED TO BE FROM A THIRD PARTY. THE DONOR HAD APPEARED IN PERSON BEFORE THE ASSESSING OFFICER AND CONFIRMED THE MAKING OF THE GIFT AND THE REASONS WH ICH PERSUADED HIM TO MAKE THE GIFT, HE BEING THE FRIEND OF THE ASSESSEES FATHER WHO HELPED HIM IN PAST. SEC. 68 PROVIDES FOR CHARGING THE SUM CREDITED IN A SSESSEES BOOKS OF ACCOUNT AS INCOME OF ASSESSEE IF ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCES OF SUM SO CREDITED OR IF THE EXPLANATION OFFERED BY ASSESSEE THEREOF W AS NOT SATISFACTORY. ON THE FACTS AND CIRCUMSTANCES AS NAR RATED ABOVE, IN MY OPINION, ARE SUCH AS SATISFACTORILY EX PLAINS THE NATURE AND SOURCES OF THE CREDIT BY WAY OF GIFT. T HEREFORE, GIFT COULD NOT BE SAID TO BE CREDIT, THE SOURCES OF WHIC H WERE NOT EXPLAINED SATISFACTORILY. IT WAS A GENUINE GIFT AND THE ASSESSEE HAS PROVED ITS SOURCES SATISFACTORY. THEREFORE, THE IMPUGNED GIFT WAS HELD GENUINE AND CONSEQUENTLY NO ADDITION THEREOF CAN BE MADE TO THE INCOME OF ASSESSEE AS INCOME FROM OT HER SOURCES U/S.68 OF THE ACT HELD BY THIRD MEMBER. 2.6 IN THIS BACKGROUND, ASSESSEE CLAIMED THAT THEY HAD RECEIVED THE GIFTS TOTALING TO USD1,00,000/- EQUIVA LENT TO APPROXIMATE RS.68,66,378/- FROM ONE PERSON, NAMELY, SHRI SUNIL KUMAR K GANDHI ON 31.08.2004 AND THE SAID IMD S WERE ENCASHED BY ASSESSEE ON 29.12.2005 INCLUDING INTERE ST TOTALING TO RS.68,66,378/-. IN REGARD TO ISSUE OF TAXABILIT Y OF GIFTS THE ASSESSEE'S MAIN STAND HAS BEEN THAT SECTION 56(2)(V ) OF THE ACT MENTIONS THE WORD 'ANY SUM OF MONEY' AND ACCORDING TO THE ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 9 ASSESSEE THE GIFT OF IMDS DID NOT FALL WITHIN THE P URVIEW 'ANY SUM OF MONEY'. ASSESSEE ALSO CLAIMED THAT IN THE I NSTANT CASE THE GIFT WAS RECEIVED BEFORE 01.09.2004, WHICH WAS MUCH PRIOR TO THE INSERTION OF SECTION 56(2)(V) OF THE ACT INS ERTED BY THE FINANCE ACT W.E.F 01.04.2005. ASSESSEE ALSO FILED THE COPIES OF CERTIFICATES OF IMDS BEARING NUMBERS C151871 TO C15 1875 AND C161772 TO 161776. IN VIEW OF THIS, WE HOLD THAT G IFT IN QUESTION DOES NOT FALL WITHIN THE PURVIEW OF ANY SU M AS ENVISAGED IN SECTION 56(2)(V) OF THE ACT. 2.7 FURTHER, LD. AUTHORIZED REPRESENTATIVE RELIED O N THE RELEVANT PORTION OF ITAT IN AVINASH KUMAR SINGH (SU PRA) HELD AS UNDER: 7. WHEN THERE ARE TWO POSSIBLE VIEWS ONE IN FAVOUR OF THE ASSESSEE AND THE OTHER IN FAVOUR OF THE REVENUE, WH ICH VIEW SHOULD BE ACCEPTED IS A MILLION DOLLAR QUESTION BEF ORE US. THE VIEW IN FAVOUR OF THE ASSESSEE IS FORTIFIED WIT H NUMEROUS EVIDENCES WHICH FORMS A COMPLETE CHAIN OF EVENTS, A S HAS BEEN DISCUSSED ABOVE. THE OCCASION OF HAVING MADE T HIS GIFT HAS BEEN EXPLAINED BY THE DONOR HIMSELF THAT HE WAS OBLIGED BY THE FATHER OF THE DONEE IN THE YEAR 1994 DURING HIS VISIT TO DEITY VAISHNO DEVI WHEN THE FATHER OF THE ASSESSE E HELPED HIM AND HIS FAMILY MEMBERS. THUS, THE OCCASION AND REASON FOR MAKING A GIFT ARE ALSO GIVEN BY THE DONOR, ALBE IT, AS OF NOW THESE ARE NO LONGER THE REQUIREMENTS OF A VALID GIFT IN VIEW OF RECENT DECISION OF THE TRIBUNAL IN MISS MAY AWATIS CASE, INCLUDING THE ONE OF THIS VERY BENCH. THE SOU RCE OF GIFT HAS ALSO BEEN EXPLAINED WITH THE HELP OF POSSIBLE A ND FEASIBLE EVIDENCES WHICH ARE AVAILABLE ON THE RECOR D. AGAINST THAT ARE PITTED THE INFERENCES OF LEARNED AO THAT T HIS IS NOT PROVED THAT IS NOT PROVED AND OTHER WHYS AND WHEREF ORES. IN THESE CIRCUMSTANCES, IT WOULD BE TOO HARSH AND TOO ILLOGICAL TO DECIDE AGAINST THE ASSESSEE WHO HAS PRODUCED ENT IRE EVIDENCES DESIRED, REQUIRED AND INSISTED ON BY LEAR NED AO AND THAT WOULD RESULT IN AN ILLEGALITY AND INJUSTIC E. WE HAVE ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 10 TO GO BY EVIDENCES AVAILABLE ON THE RECORD. THE POS SIBILITIES AND REALITIES OF LIFE COME ONLY THEREAFTER, AND WHE N THE ADVERSE POSSIBILITIES ARE ALSO FOUND TO BE EXPLAINE D THERE SHOULD BE AN END OF THESE 'POSSIBLE REALITIES', OTH ERWISE NO GIFT WOULD BE OR CAN BE TREATED AS GENUINE, AS THE REALITY OF LIFE, IN THIS ERA IS THAT EVEN A FATHER WOULD NOT G IVE A GIFT TO HIS SON. THUS, WE ARE BOUND BY THE POSITIVE EVIDENC ES WHICH ARE AVAILABLE ON RECORD AND FORM A COMPLETE CHAIN O F EVENTS. HERE, WE ACCEPT THIS GIFT AS GENUINE BECAUSE THE ID ENTITY AND THE CREDITWORTHINESS OF THE DONOR HAVE BEEN EST ABLISHED ON RECORD. THE REASON FOR MAKING THIS GIFT IS ALSO STATED AND ITS GENUINITY STANDS PROVED. ENTIRE EVIDENCES, WHIC H HAVE BEEN REFERRED TO ABOVE LIKE THE DECLARATION OF GIFT , AFFIDAVIT OF DONOR, DIRECT LETTER SENT TO AO, STATEMENT ON OATH BOTH OF DONOR AND THE DONEE, PROOF OF SOURCE OF THE DRAFT O F RS. 2,50,000 WITH FURTHER EVIDENCE, INTER ALIA, GO TO P ROVE THE CLAIM OF THE ASSESSEE. THEREFORE, WE DELETE THE IMP UGNED ADDITION AND ALLOW THIS APPEAL. 2.8 NOTHING CONTRARY WAS BROUGHT TO OUR KNOWLEDGE. FACTS BEING SIMILAR, SO, FOLLOWING SAME REASONING, THIS I SSUE IS DECIDED IN FAVOUR OF ASSESSEE. 2.9 REGARDING INTEREST, ASSESSEE RELIED ON NOTIFICA TION U/S. 10(15)(I) OF THE ACT WHICH READS AS UNDER: SECTION 10(15)(I) OF THE INCOME-TAX ACT, 1961 EXEMPTIONS INCOME BY WAY OF INTEREST, ETC., ON BO NDS, SECURITIES SPECIFICATION OF BONDS, SECURITIES, ET C. ISSUED BY CENTRAL GOVERNMENT. NOTIFICATION NO. 188/2005 [F.NO. 178/43/2005-IT(A- I)] S.O. 1114(E), DATED 10-8-2005 IN EXERCISE OF THE POWERS CONFERRED BY THE SUB-CLAU SE (I) OF CLAUSE (15) OF SECTION 10 OF THE INCOME-TAX ACT, 19 61 (4 OF 1961), THE CENTRAL GOVERNMENT HEREBY SPECIFIES THE INDIA MILLENNIUM DEPOSITS, BEING BANK INSTRUMENTS REPRESENTING FOREIGN CURRENCY DENOMINATED DEPOSITS IN THE ITA NO.4980/MUM/14 A.Y. 06-07 [NILESH JHAVERI (HUF) VS. ITO] PAGE 11 FORM OF PROMISSORY NOTES, ISSUED BY THE STATE BANK OF INDIA, A BANK CONSTITUTED UNDER SECTION 3 OF THE ST ATE BANK OF INDIA ACT, 1955 (23 OF 1955), AS DEPOSITS/F OR THE PURPOSES OF THE SAID SUB-CLAUSE. 2.10 IN VIEW OF ABOVE, INTEREST IN QUESTION IS EXEM PT. SUMMING UP GIFT IN QUESTION DOES NOT FALL WITHIN THE AMBIT OF SECTION 56(2)(V) OF THE ACT AND SAME IS EXEMPT AS DISCUSSED ABOVE. 3. IN THE RESULT, THE APPEAL FILED BY ASSESSEE IS A LLOWED AS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON THIS THE 19 TH DAY OF AUGUST, 2016. SD/- SD/- ( RAJESH KUMAR ) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBE R MUMBAI: DATED 19/08/2016 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE !# / ASSESSEE $ %&%'( ) / CONCERNED CIT * )+ / CIT (A) ,-./00'(1 '( 12 %& / DR, ITAT, MUMBAI 3/4567 / GUARD FILE. BY ORDER / #8 1 9: ;% 1 '( 12 %&<