GUNVANTIBEN N.SHAH, MUMBAI V. ACIT CEN CIR 17 & 28, MUMBAI

ITA 7386/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2432 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 16-11-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 16-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift; Additional evidence
• Section: 143(3)

Judgement Text

GUNVANTIBEN N SHAH ITA NO. 7386 /MUM/20 1 3 1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G , MUMBAI , , BEFORE SHRI AMIT SHUKLA , JUDICIAL MEMBER AND SHRI RAMIT KOCHAR , ACCOUNTAN T MEMBER ITA NO. : 7386 /MUM/20 1 3 ( ASSESSMENT YEAR: 200 3 - 04 ) GUNVANTIBEN N SHAH , C/O M/S LAXMI LAMINATES, 5, ABHISHEK BUILDING, VALLABHBHAI ROAD, VILE PARLE(WEST), MUMBAI - 400 056 .: PAN: A APPS 744 8 R/ .: PAN: A APPS 7446 B VS ASS T COMMISSIONER OF INCOME TAX - CENTRAL CIRCLE 17 & 28, MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI ABANI KANTA NAYAK /DATE OF HEARING : 16 - 1 1 - 201 5 / DATE OF PRONOUNCEMENT : 16 - 11 - 201 5 ORDER , . . : PER AMIT SHUKLA, J M : THE AFORESAID APPEAL HA S BEEN FILED BY THE ASSESSEE AGAINST IMPUGNED ORDER DATED 05.09 .2013 , PASSED BY CIT(A) - 39 , MUMBAI IN RELATION TO THE PENALTY PROCEEDINGS U/S 271(1)(C) FOR THE ASSESSMENT YEAR 2003 - 04 . THE ASSESSEE IS MAINLY AGGRIEVED BY THE LEVY OF PENALTY OF RS.2 ,87,700 / - ON ACCOUNT OF GIFT WHICH WERE TREATED AS INCOME FROM OTHER SOURCES U/S 68. 2. DESPITE SERVICE O F NOTICE THROUGH RPAD , NONE APPEARED ON BEHALF OF THE ASSESSEE - APPELLANT NEITHER ANY ADJOURNMENT LETTER HAS BEEN FILED HENCE, WE PROCEED TO DECIDE THE APPEAL EX - PARTE WITHOUT THE ASSESSEE ON MERITS AFTER HEARING LD. DR. GUNVANTIBEN N SHAH ITA NO. 7386 /MUM/20 1 3 2 3. BRIEF FACTS ARE THAT, IN THE AS SESSMENT ORDER PASSED U/S 143(3) R.W.S. 153A, IT WAS FOUND THAT ASSESSEE HAD SHOWN SUM OF RS. 10 LAKHS BEING GIFT RECEIVED FROM ONE , SHRI GYACHAND C JAIN. IN RESPECT OF PROVING THE GENUINENESS OF THE GIFT, THE ASSESSEE HAD FURNISHED CONFIRMATION FROM THE DONOR WITH ALL THE DETAILS AND ADDRESS AND ALSO GIVING THE DETAILS OF AMOUNT GIVEN IN CHEQUE . HOWEVER, THE AO NOTED THAT THE RELATIONSHIP WITH THE DONOR AND THE OCCASION ON WHICH THE GIFT WAS RECEIVED HAD NOT BEEN SUBMITTED BY THE ASSESSEE . THE AO REQUI RED THE ASSESSEE TO PRODUCE THE DONOR WHO WAS ALSO ISSUED SUMMONS U/S 131 DIRECTLY BY THE AO ASKING HIM TO APPEAR PERSONALLY. HOWEVER, THE SAID DONOR DID NOT ATTEND IN PERSON ALBEIT FILED A LETTER DATED 05.03.200 8 FURNISHING THE RELEVANT DETAILS OF A GIFT GIVEN TO THE ASSESSEE AND ALSO HIS RETURN OF INCOME . THE AO FROM SUCH DETAILS NOTED THAT THE DONOR HAD SHOWN SMALLER TAXABLE INCOME OF RS. 1,04,280/ - AND AGRICULTURE INCOME OF RS. 50,25,755/ - WHICH CANNOT BE SUBSTANTIATED IN ABSENCE OF ANY DOCUMENTARY EVID ENCES. NOT ONLY THAT, THE SAME DONOR HAS ALSO GIVEN GIFT OF RS. 1,10,00,000/ - DURING THE ASSESSMENT YEAR 2003 - 04 TO 11 PERSONS. ACCORDINGLY, AFTER DETAILED DISCUSSIONS, HE ADDED THE AMOUNT OF GIFT AS INCOME FROM OTHER SOURCES . IT APPEARS THAT ASSESSEE DI D NOT FILE ANY APPEAL CHALLENGING THE SAID ADDITION. NOW, PENALTY HAS BEEN LEVIED BY THE AO ON THE SAID AMOUNT OF GIFT AFTER DETAILED DISCUSSION. 4. ASSESSEES MAIN CONTENTION BEFORE THE AO AS WELL AS CIT(A) IN THE COURSE OF THE PENALTY PROCEEDINGS HAD BE EN THAT, THE DONOR HAD BEEN IDENTIFIED ; HE HAS FILED HIS CONFIRMATION ALONG WITH ADDRESS ; HIS COPY OF BANK STATEMENT AND INCOME - TAX RETURN WERE ALSO FURNISHED, TO PROVE THE GENUINENESS OF THE GIFT. SO FAR AS THE ASSESSEE IS CONCERNED, THE ONUS STOOD DISCHA RGED. HOWEVER, BOTH THE AO AS WELL AS CIT(A) HAVE CONFIRMED THE SAID PENALTY. GUNVANTIBEN N SHAH ITA NO. 7386 /MUM/20 1 3 3 5. AFTER CONSIDERING THE RELEVANT FINDING GIVEN IN THE IMPUGNED ORDERS AND ARGUMENTS PLACED BY THE DR, WE FIND THAT THE PRIMARY INGREDIENT OF PROVING THE NATURE AND SOURCE OF CR EDIT WHICH HERE IN THIS CASE IS GIFT OF RS. 10 LAKHS HAS BEEN DISCHARGED/ SHOWN IN THE FOLLOWING MANNER : - (I) CONFIRMATION LETTER OF THE DONOR GIVING PARTICULARS OF ADDRESS AND THE MODE OF THE PAYMENT OF GIFT; (II) BANK STATEMENT OF THE DONOR FROM W HERE THE CHEQUE WAS ISSUED TO THE ASSESSEE; AND (III) INCOME - TAX RETURN FOR THE IMPUGNED ASSESSMENT ORDER WHEREIN THE DONOR HAS SHOWN AGRICULTURAL INCOME OF RS. 50.25 LAKHS AND INCOME FROM OTHER ACTIVITIES AT RS. 1.23 LAKHS. THE ASSESSEES EVIDENCES A ND EXPLANATION HAS NOT BEEN ACCEPTED BY THE REVENUE AUTHORITIES ON THE GROUND THAT FIRSTLY , THE DONOR COULD NOT BE PRODUCED BY THE ASSESSEE NOR HE APPEARED IN RESPONSE TO THE SUMMON ISSUED BY THE AO AND SECONDLY , THERE IS NO DOCUMENTARY EVIDENCE TO PROVE T HAT THE DONOR HAD SUCH A HUGE AGRICULTURAL INCOME. APART FROM TH ESE FACT S , THE MAIN ADVERSE INFERENCE WHICH HAS BEEN DRAWN IS ON THE GROUND THAT , THE DONOR HAS GIVEN GIFT AGGREGATING TO RS.1,10,00,000/ - TO 11 MEMBERS OF EURO GROUP INCLUDING THE ASSESSEE WHICH IS NOT A NORMAL HUMAN CONDUCT/ BEHAVIOR. EVEN THOUGH THE SAID ADDITION HAS ATTAINED FINALITY IN THE QUANTUM PROCEEDINGS BUT THEY CANNOT BE HELD AS FINAL OR CONCLUSIVE SO FAR AS PENALTY PROCEEDINGS ARE CONCERNED, BECAUSE THE ASSESSEE FROM THE SAME MATE RIAL CAN POINT OUT THE FACTORS FAVORABLE TO THE ASSESSEE OR BY PRODUCING ANY ADDITIONAL EVIDENCE TO DEMONSTRATE THAT HE IS NOT GUILTY OF CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS. THE ASSESSEES EXPLANATION ABOUT THE GENUINENESS OF THE GIFT IS SUBSTANTIATED BY VARIOUS PRIMARY EVIDENCES AND ONCE THESE EVIDENCES HAVE BEEN FILED, THEN ONUS SHIFTS UPON THE AO TO SHOW THAT THE ASSESSEES EXPLANATION AND EVIDENCES ARE FALSE OR NOT BONA FIDE . HERE THERE HAS BEEN NO ENQUIRY BY THE AO TO REBUT TH E S E EVIDENCES ALBEIT THE AO HAS DISBELIEVED ON THE BASIS OF CERTAIN HYPOTHESIS AND PREMISE GUNVANTIBEN N SHAH ITA NO. 7386 /MUM/20 1 3 4 THAT SUCH A CONDUCT OF GIVING THE GIFT IS IMPROBABLE. THIS HYPOTHESIS OR PREMISE, HOWSOEVER STRONG MAY BE FOR THE QUANTUM PROCEEDINGS OR MAY HAVE A PROBATIVE VALUE BUT CERTAINLY THEY ARE NOT SUFFICIENT SO FAR AS PENALTY PROCEEDINGS ARE CONCERNED. ONCE THE DONOR HAS FURNISHED HIS BANK STATEMENT FROM WHERE THE AMOUNT OF GIFT HAS BEEN GIVEN, THE COPY OF HIS INCOME TAX RETURN BEFORE THE AO , THEN WITHOUT ANY REBUTTAL O F SUCH EVIDENCES BY ANY SPECIFIC ENQUIRY, THE PENALTY CANNOT BE SUSTAINED. ACCORDINGLY, UNDER THE FACTS AND CIRCUMSTANCES, WE DELETE THE LEVY OF PENALTY OF RS. 2,87,700/ - AND ACCORDINGLY , GROUND RAISED BY THE ASSESSEE IS ALLOWED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH NOVEMBER , 2015. SD/ - SD/ - ( ) ( ) (RAMIT KOCHAR ) ( AMIT SHUKLA ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATE: 1 6 TH NOVEMBER , 2015 / COPY TO: - 1 ) / THE APPELLANT. 2 ) / THE RESPONDENT. 3 ) THE CIT (A) - 39 , MUMBAI. 4 ) THE CIT CENTRAL - II , MUMBAI. 5 ) , , / THE D.R. G BENCH, MUMBAI. 6 ) \ COPY TO GUARD FILE. / BY ORDER / / TRUE COPY / / / , DY. / ASSTT. REGISTRAR I.T.A.T., MUMBAI * . . *CHAVAN, SR.PS