Sh. Gourav Arora, Jalandhar V. The Income-tax Officer, Jalandhar

ITA 555/ASR/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8740 (ITAT-AMRITSAR)
• Duration Of Justice: 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Amritsar
• Assessment Year: 2009-2010
• Appeal Filed On: 07-11-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: BHAWANI SHANKAR
• Keywords: Gift
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH: (CIRCUIT BENCH AT JALANDHAR) BEFORE SHRI A. D. JAIN, JUDICIAL MEMBER, AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A NO.555/ASR/2016 (ASSESSMENT YEAR-2009-10) SH. GAURAV ARORA, 40/8, CENTRAL TOWAN, JALANDHAR. PAN NO.AAEFS9575J (ASSESSEE) VS .. ITO-WARD III, (IV), JALANDHAR. (REVENUE) ASSESSEE BY SHRI . J. S. BHASIN, AR. REVENUE BY SHRI BHAWANI SHANKAR,DR. ORDER PER, A. D. JAIN, JUDICIAL MEMBER: THIS IS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2009- 10 CONTENDING THAT THE LD. CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF R S.5.50 LACS. 2. THE AO HAD AIR INFORMATION THAT THE ASSESSEE WAS HAVING CASH DEPOSIT OF RS.18,54,000/- IN HIS SAVINGS BANK ACCOUNT. ON BEIN G ASKED TO EXPLAIN THE SOURCE OF THE CASH DEPOSITS, THE ASSESSEE EXPLAINED THAT T HE ACTUAL DEPOSITS IN THE BANK WERE OF RS.9 LACS. THESE WERE STATED TO HAVE BEEN R ECEIVED BY WAY OF THREE GIFTS, I.E., RS.2.50 LACS FROM HIS REAL SISTER, RS.2 LACS FROM HIS UNCLE AND RS.5.50 LACS FROM HIS GRANT MOTHER. THE ASSESSEE FILED EVIDENCE IN SUPPORT OF THESE GIFTS, STATING DATE OF HEARING 19.01.2017 DATE OF PRONOUNCEMENT 22 .02.2017 I.T.A NO.555/ASR/2016 2 THAT HE WAS JUST TWENTY YEARS OF AGE AND HAD A PART TIME INCOME OF RS.1,15,000/- FROM TUITION ETC, WHICH WAS DECLARED IN THE RETURN OF INCOME FILED ON 29.06.2009. THE AO ACCEPTED THE FIRST TWO GIFTS. HE, HOWEVER, R EFUSED TO ACCEPT THE GIFT OF RS.5.50 LACS STATED TO HAVE BEEN RECEIVED FROM HIS GRAND-MOTHER. THE GRAND- MOTHER OF THE ASSESSEE HAD EXPIRED ON 25.06.2011. S HE WAS STATED TO HAVE BEEN PASSED SAVINGS AND RENTAL INCOME FROM PROPERTY AT J ALANDHAR. ONE OF THE CO- TENANTS, SH. VARINDER PANDEY WAS PRODUCED BEFORE TH E AO ON 25.11.2011. HE STATED TO MAKE PAYMENT OF RS.3,000/- PER MONTH AS R ENT TO THE GRAND-MOTHER OF THE ASSESSEE. IN SUPPORT, RENT RECEIPTS WERE PRODUCED, OWNERSHIP DOCUMENTS CONCERNING THE PROPERTY WAS FILED. AFFIDAVIT OF THE ASSESSEES FATHER, WHO STATED TO HAVE WITNESSED THE GIFT, WAS ALSO FURNISHED. HOWEVE R, THE AO MADE THE ADDITION, DOUBTING THE CREDITWORTHINESS OF THE GRAND-MOTHER O F THE ASSESSEE. THE LD. CIT(A) CONFIRMED THE ADDITION, HOLDING THAT THE ASSESSEE H AD FAILED TO FURNISH EVIDENCE TO SUBSTANTIATE THE SOURCE OF HIS GRANT MOTHER. 3. THE LD. COUNSEL FOR THE ASSESSEE HAS CONTENDED T HAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS.5.50 LACS ON ERRON EOUS AND INSUFFICIENT GROUNDS; THAT THE ASSESSEES EXPLANATION AS TO THE SOURCE OF THE DEPOSITS OF RS.5.50 LACS, HAS RECEIVED BY THE ASSESSEE FROM HIS GRAND-MOTHER, WAS BEGGED BY DOCUMENTARY EVIDENCE; THAT THE SAME WAS ILLEGAL NOT ACCEPTED. 4. ON THE OTHER HAND, THE LD. DR HAS STRONGLY RELIE D ON THE IMPUGNED ORDER. I.T.A NO.555/ASR/2016 3 5. IT IS INDISPUTED THAT THE ASSESSEE IS A YOUNG MA N, WHO HAS HITHERTO NOT ESTABLISHED ANY REGULAR BUSINESS. HE WAS TAKING TUI TIONS AND THE SAME WAS HIS SOURCE OF INCOME, HAD DECLARED IN THE RETURN OF INC OME FILED. THIS AMOUNTED TO INCOME OF RS.1,15,000/-. THE LD. CIT(A) HELD THAT T HE ASSESSEE HAD FAILED TO FURNISH EVIDENCE TO SUBSTANTIATE THE SOURCE OF THE CASH DEP OSITS IN THE HANDS OF HIS GRAND- MOTHER AND THAT SO, THE ASSESSEE HAD FAILED TO PROV E THE CREDITWORTHINESS OF THE DONOR. 6. IT IS WELL SETTLED THAT THE ONUS OF THE ASSESSEE IS TO PROVE THE CREDITWORTHINESS OF THE DONOR. THIS DOES NOT AMOUNT TO ASKING THE AS SESSEE TO PROVE OF HIS SOURCE. IN CASE THE DONOR ACCEPTS HAVING MADE THE PAYMENT, INQ UIRY MAY BE CONDUCTED IN THE CASE OF THE DONOR. HOWEVER, THE ONUS OF THE ASSESSE E STAND DISCHARGED. IN THE PRESENT CASE, THE DONOR, I.E., THE GRAND-MOTHER OF THE ASSESSEE INFORMED UNFORTUNATELY EXPIRED. HOWEVER, THE ASSESSEE PRODUC ED THE CO-TENANT OF THE PROPERTY OF HIS GRAND-MOTHER. THIS WITNESS, SHRI VA RINDER PANDEY, STATED TO HAVE BEEN MAKING A MONTHLY RENT OF RS.3,000/- TO THE GRA ND-MOTHER OF THE ASSESSEE. DOCUMENTARY EVIDENCE IN THE SHAPE OF THE OWNERSHIP DOCUMENT OF THE PROPERTY IN THE HANDS OF THE ASSESSEES GRAND-MOTHER, RENT RECE IPTS AND AFFIDAVIT OF ASSESSEES FATHER WERE FILED. IN HIS AFFIDAVIT, THE ASSESSEES FATHER STATED HAVING WITNESSED THE GIFT HAVING BEEN MADE TO THE ASSESSEE BY THE ASSESS EES GRAND-MOTHER. THERE IS NO EVIDENCE TO THE CONTRARY BROUGHT ON RECORD. HOWEVER , THIS EVIDENCE HAS NOT BEEN I.T.A NO.555/ASR/2016 4 TAKEN INTO CONSIDERATION BY THE LD. CIT(A). THEREFO RE, THE CIT(A)S ORDER IS A RESULT OF CONCEPT MISREADING AND NON-READING OF MAT ERIAL EVIDENCE BROUGHT ON RECORD. HAD THIS DOCUMENTARY AND ORAL EVIDENCE BEEN TAKEN INTO CONSIDERATION, THE ADDITION COULD NOT HAVE BEEN SUSTAINED. THE COGENT EVIDENCE PRODUCED BY THE ASSESSEE HAS NEVER BEEN DISPROVED AND EVEN IN THE A BSENCE AND IN SPITE THEREOF THE ASSESSEES EXPLANATION WAS REJECTED, WHICH AGAIN AC TION WAS WRONGLY CONFIRMED BY THE LD. CIT(A). 7. MOREOVER, IT HAS NOT BEEN DISPUTED THAT THE ASSE SSEE IS INCAPABLE OF GENERATING INCOME TO MATCH THE CREDITS APPEARING IN HIS BANK ACCOUNT. IN SIMILAR CIRCUMSTANCES, IN CIT VS. P.K. NOOR JAHAN, 237 IT R 570 (SC), ADDITION UNDER SECTIONS 68/69 HAS BEEN HELD TO BE NOT SUSTAINABLE. THE LD. CIT(A) HAS FAILED TO CONSIDER THIS ASPECT OF THE MATTER TOO. 8. IN VIEW OF THE ABOVE DISCUSSION, FINDING MERIT T HEREIN, THE GRIEVANCE OF THE ASSESSEE IS ACCEPTED. THE ORDER UNDER APPEAL IS REV ERSED. THE ADDITIONS IS DELETED. 9. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 22/02/2017. SD/- SD/- (T. S. KAPOOR) (A.D. JAIN) ACCOUTANT MEMBER JUDICIAL MEMBER DATED 22/02/2017 *AKV* COPY FORWARDED TO: I.T.A NO.555/ASR/2016 5 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT BY ORDER AR/SR.P.S./P.S.