Smt. Sheela Sharma, Gwalior V. I.T.O., Shivpuri

ITA 88/AGR/2013

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 0724 (ITAT-AGRA)
• Duration Of Justice: 6 year(s) 1 month(s) 12 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 24-06-2013
• Assessment Year: misc
• Appeal Filed On: 04-04-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SPS B
• Assessee Lawyers: V BAPNA C A SHRI K K MISHRA
• Keywords: Gift; Set aside
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 88/AGRA/2013 ASSTT. YEAR : 2007-08 SMT. SHEELA SHARMA, VS. INCOME-TAX OFFICER, 25A, MORAR ENCLAVE, SHIVPURI. GOLE KA MANDIR, GWALIOR. (PAN : BYSPS 9822 B) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI V. BAPNA, C.A. RESPONDENT BY : SHRI K.K. MISHRA, JR. DR DATE OF HEARING : 24.06.2013 DATE OF PRONOUNCEMENT OF ORDER : 28.06.2013 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A), GWALIOR DATED 22.02.2013 FOR THE ASSESSMENT YEAR 20 07-08. 2. WE HAVE HEARD THE LD. REPRESENTATIVES OF BOTH TH E PARTIES, PERUSED THE FINDINGS OF THE AUTHORITIES BELOW AND CONSIDERED TH E MATERIAL ON RECORD. 3. ON GROUND NO. 1, THE ASSESSEE CHALLENGED THE ADD ITION OF RS.3,50,000/- ON ACCOUNT OF UNEXPLAINED GIFT. THE ASSESSEE HAS RECEI VED GIFT OF RS.3.5 LACS FROM HER FATHER SHRI VASUDEV SHARMA ON 01.04.2006 RS.1,00,00 0/- AND ON 22.09.2006 ITA NO. 88/AGRA/2013 2 RS.2.5 LACS. THIS WAS RECEIVED IN CASH AND OCCASION BEING CONSTRUCTION OF RESIDENTIAL HOUSE BY THE ASSESSEE. THE AO REQUIRED THE ASSESSEE TO PRODUCE DONOR FOR EXAMINATION, BUT HE WAS NOT PRODUCED. THE ASSES SEE HAS MERELY FILED A PLAIN LETTER FROM THE DONOR IN WHICH HE HAS STATED TO HAV E GIFTED RS.3,50,000/- ON THE ABOVE TWO DAYS. IT WAS CLAIMED IN THE SAID LETTER T HAT THE GIFT IS MADE OUT OF HIS SAVINGS AND ADVANCE GIVEN TO THE FARMERS, BUT THE S AME WAS NOT SUPPORTED BY EVIDENCE. FULL ADDRESS OF THE DONOR HAS ALSO NOT BE EN GIVEN. THE AO, THEREFORE, HELD THAT THE ASSESSEE HAS FAILED TO PROVE IDENTITY OF THE DONOR, HIS CAPACITY TO GIVE GIFT TO THE ASSESSEE AND GENUINENESS OF THE TRANSAC TION. THE GIFT WAS, THEREFORE, TREATED UNEXPLAINED AND ADDITION WAS MADE U/S. 68 O F THE IT ACT. THE ASSESSEE PRODUCED THE DONOR AT THE APPELLATE STAGE AND REMAN D REPORT WAS ALSO SUBMITTED BY THE AO, BUT THE DONOR COULD NOT PROVE SATISFACTORIL Y THE SOURCE OF CASH OF RS.3.5 LACS. THE LD. CIT(A) WAS, THEREFORE, OF THE VIEW TH AT THE DONOR COULD NOT PRODUCE ANY EVIDENCE TO SUBSTANTIATE HIS EXPLANATION. THE C REDITWORTHINESS OF THE DONOR AND GENUINENESS OF THE GIFT WAS NOT PROVED. THEREFORE, THE APPEAL OF THE ASSESSEE ON THIS GROUND WAS DISMISSED. 4. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND REFERRED TO PB-6, WHICH IS ST ATEMENT OF THE DONOR RECORDED AT THE APPELLATE STAGE IN WHICH HE HAS CONFIRMED GIVIN G OF GIFTS TO HIS DAUGHTER. PB-9 IS THE LETTER WRITTEN TO THE AO. PB-10 TO 15 ARE TH E RECORD OF LAND HOLDING OF 22 ITA NO. 88/AGRA/2013 3 BIGHAS BY THE DONOR. PB-16 TO 27 ARE THE COPIES OF THREE SALE DEEDS OF DATED 09.09.2002, 28.08.98 AND 28.08.99 FOR SELLING THE A GRICULTURAL LAND OF 12.5 BIGHAS IN CHATARPUR FOR TOTAL SUM OF RS.5,45,100/-. HE HAS , THEREFORE, SUBMITTED THAT DONOR HAS SUFFICIENT MEANS TO GIVE GIFT TO HIS DAUGHTER. HOWEVER, NO GIFT DEED HAS BEEN EXECUTED IN THIS CASE. DONOR WAS ALSO HAVING RENTAL INCOME OF RS.12,000/- AND ALSO RECEIVING PENSION FROM MADHYA PRADESH GOVERNMENT. C OPIES OF TWO BANK ACCOUNTS WITH NAGRIK SAHKARI BANK, GWALIOR AND BANK OF INDIA ARE FILED IN THE PAPER BOOK AT PAGE 30 TO 33. HE HAS, HOWEVER, SUBMI TTED THAT SINCE GIFTS ARE GIVEN THROUGH CASH, THEREFORE, BANK STATEMENT IS NOT RELE VANT. HE HAS, THEREFORE, SUBMITTED THAT THE ASSESSEE HAS PROVED GENUINE GIFT IN THE MATTER. 5. ON THE OTHER HAND, THE LD. DR RELIED UPON THE OR DERS OF THE AUTHORITIES BELOW AND DECISION REPORTED IN 291 ITR 306 (NO RELEVANT C ASE LAW) AND DECISION OF PUNJAB & HARYANA HIGH COURT IN THE CASE OF TIRATHRA M GUPTA VS. CIT, 304 ITR 145, IN WHICH IT WAS HELD, A GIFT CANNOT BE ACCEPTE D AS SUCH TO BE GENUINE, MERELY BECAUSE THE AMOUNT HAS COME BY WAY OF CHEQUES OR DR AFT THROUGH BANKING CHANNELS UNLESS THE IDENTITY OF THE DONOR, HIS CREDITWORTHIN ESS, RELATIONSHIP WITH THE DONEE AND THE OCCASIONS ARE PROVED. UNLESS THE RECIPIENT HAS PROVED THE GENUINENESS THEREOF, THE GIFT CAN VERY WELL BE TREATED TO BE AN ACCOMMODATION ENTRY OF ASSESSEES OWN MONEY, WHICH IS NOT DISCLOSED FOR TH E PURPOSE OF TAXATION. ITA NO. 88/AGRA/2013 4 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDERS OF THE AUTHORITIES BEL OW IN CONFIRMING THE ADDITION U/S. 68 OF THE IT ACT ON ACCOUNT OF UNEXPLAINED GIFT. TH E ASSESSEE CLAIMED GENUINENESS OF THE GIFT OF RS.3,50,000/- RECEIVED IN CASH FROM HER FATHER SHRI VASUDEV SHARMA ON TWO OCCASIONS, HOWEVER, IT IS ADMITTED FACT THAT NO GIFT DEED HAS BEEN EXECUTED IN THE MATTER. THEREFORE, NECESSARY INGREDIENTS OF GIFT THAT THE GIFT WAS GIVEN BY THE DONOR AND ACCEPTED BY THE DONEE HAVE NOT BEEN PROVE D THROUGH EVIDENCE. IN THE ABSENCE OF ANY GIFT DEED, THE GENUINENESS OF THE GI FT RECEIVED BY THE ASSESSEE IS ALSO NOT ESTABLISHED. FURTHER, THE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF GIFT IN THE MATTER. THE DONOR HAS FILED A LETTER BEFORE THE AO IN WHICH HE HAS EXPLAINED GIVING OF GIFT OF RS.1,00,000/- IN CASH ON 01.04.2006 AND RS.2,50,000/- IN CASH ON 22.09.2006. HOWEVER, THE SOURCE OF BOTH THE GIFTS H AVE NOT BEEN ESTABLISHED AND PROVED. THE ASSESSEE FILED DOCUMENTS OF LAND HOLDIN G BY THE DONOR, WHICH WOULD NOT PROVE WHETHER THE DONOR HAS ANY AGRICULTURAL IN COME SUFFICIENT TO SAVE ANY AMOUNT FOR THE PURPOSE OF MAKING GIFT. NO SOURCE OF EARNING OF ANY SUFFICIENT AGRICULTURAL INCOME HAS BEEN FILED. THEREFORE, SUCH DOCUMENTS WOULD NOT SUPPORT THE CASE OF THE ASSESSEE. FURTHER, THE COPY OF THRE E SALE DEEDS HAVE BEEN FILED TO SHOW THAT THE DONOR HAS AVAILABILITY OF RS.5,45,100 /- ON ACCOUNT OF SALE OF 12.5 BIGHAS OF AGRICULTURAL LAND AT CHATARPUR. THE DATES OF SALE DEEDS ARE 09.09.2002, 28.08.98 AND 28.08.99. THERE IS A WIDE DIFFERENCE O F SEVERAL YEARS IN THE EXECUTION OF SALE DEEDS AND THE GIFT GIVEN TO THE ASSESSEE IN ASSESSMENT YEAR 2007-08. IT IS NOT ITA NO. 88/AGRA/2013 5 EXPLAINED AS TO WHERE THE DONOR HAS KEPT MONEY AFTE R SELLING THE AGRICULTURAL LAND. THE COPIES OF TWO BANK ACCOUNTS OF THE DONOR ARE FI LED IN THE PAPER BOOK, IN WHICH NO SUCH AMOUNT OF RECEIPT OF SALE PROCEEDS OF AGRIC ULTURAL LAND HAVE BEEN DEPOSITED. THERE ARE NO SUFFICIENT WITHDRAWALS FROM THE BANK TO ESTABLISH GIVING OF CASH GIFTS TO THE ASSESSEE. PRIOR TO THE MONTH OF A PRIL, 2006 AND SEPTEMBER, 2006, THERE ARE NO SUFFICIENT CASH WITHDRAWALS TO MAKE TH E GIFT. IN THE ACCOUNT WITH THE BANK OF INDIA, DONOR HAS RECEIVED PENSION OF APPROX IMATELY RS.6,000/- PER MONTH AND IMMEDIATELY AMOUNT HAS BEEN WITHDRAWN IN CASH. THUS, THE ASSESSEE FAILED TO ESTABLISH AVAILABILITY OF CASH WITH THE DONOR AT TH E TIME OF GIVING GIFT AFTER SELLING THE AGRICULTURAL LAND WAY BACK IN 1999 TO 2002. THE ASSESSEE THUS, MADE ALL VAGUE ASSERTIONS, BUT FAILED TO PROVE CREDITWORTHINESS OF THE DONOR AND GENUINENESS OF THE GIFT IN THE MATTER. NO DETAILS OF CONSTRUCTION OF H OUSE BY THE ASSESSEE HAVE BEEN BROUGHT ON RECORD. THUS, NO OCCASION OF GIVING GIFT ALSO STANDS PROVED. HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF YASH PAL GOEAL VS. CIT, 310 ITR 75 HAS HELD AS UNDER : HELD, DISMISSING THE APPEAL THAT THE FINANCIAL POS ITION OF M. SUGGESTED THAT HE NEITHER HAD THE CAPACITY TO MAKE THE GIFT NOR THE SOURCE FROM WHERE THE GIFT WAS MADE. NO REASON WHAT SOEVER HAD BEEN ASSIGNED FOR GIFTING SUCH A HUGE AMOUNT BY M TO THE ASSESSEE. M NEVER VISITED THE HOME OF THE ASSESSEE AND HENCE THERE WA S NO LOVE AND AFFECTION. IT WAS NOTHING BUT A SUBTERFUGE TO AVOID INCOME-TAX. THE TRANSACTIONS WERE NOT GENUINE ONES. ITA NO. 88/AGRA/2013 6 6.1 WE MAY ALSO NOTE HERE THAT THE DONOR CLAIMED IN STATEMENT RECORDED BY THE AO AT APPELLATE STAGE THAT HIS INCOME IS NOT TAXABL E. THEREFORE, HE DID NOT FILE ANY RETURN OF INCOME AND HAS NO PAN. IT WOULD SHOW THAT THE DONOR HAS NO TAXABLE INCOME AND IN THE ASSESSMENT YEAR 2007-08 UNDER APP EAL, WHEN GIFTS WERE GIVEN TO THE ASSESSEE, FOR THE INDIVIDUAL ASSESSEE THE BASIC EXEMPTION LIMIT WAS RS.1,00,000/- AND FOR THE PERSONS HAVING AGE ABOVE 65 YEARS, BASIC EXEMPTION FROM INCOME-TAX WAS RS.1.85 LACS. WHEN THE DONOR HAS NO TAXABLE INCOME AND WAS NOT FILING ANY RETURN OF INCOME, WOULD CLEARLY PROVE TH AT HE WAS NOT HAVING SUFFICIENT MEANS EVEN TO MEET OUT THE BASIC NEEDS THEREFORE, T HERE IS NO QUESTION OF GIVING CASH GIFT OF RS.3,50,000/- TO THE ASSESSEE IN THE A SSESSMENT YEAR UNDER APPEAL. NO EVIDENCE OF HAVING ANY SAVINGS IN PAST HAVE BEEN FI LED. THEREFORE, THE TOTALITY OF FACTS AND CIRCUMSTANCES WOULD CLEARLY ESTABLISH THA T THE ASSESSEE HAS NO EVIDENCE TO PROVE THE CREDITWORTHINESS OF THE DONOR AND GENU INENESS OF THE TRANSACTION IN THE MATTER. THUS, THE ASSESSEE FAILED TO PROVE ALL THE BASIC INGREDIENTS OF GENUINE GIFT IN THE MATTER. SINCE NO SUFFICIENT EVIDENCES HAVE BEEN FILED BEFORE THE AUTHORITIES BELOW TO PROVE THE GENUINE GIFT IN THE MATER, THERE FORE, IT IS CLEAR THAT THE GIFTS IN THE MATTER ARE NOT GENUINE AND RATHER ARRANGED AFFA IRS OF THE ASSESSEE. CONSIDERING THE ABOVE DISCUSSION, IT IS CLEAR THAT THE ASSESSEE FAILED TO PROVE THE OCCASION OF THE GIFT AND THE CREDITWORTHINESS OF THE DONOR. GENUINE NESS OF THE GIFT IS ALSO NOT PROVED. HONBLE SUPREME COURT IN THE CASE OF CIT V S SHRI DURGA PRASAD MORE, 82 ITR 540 AND IN THE CASE OF SMT. SUMATI DAYAL VS CIT 214 ITR 801, HELD THAT THE ITA NO. 88/AGRA/2013 7 COURTS AND TRIBUNALS HAVE TO JUDGE THE EVIDENCES BE FORE THEM BY APPLYING THE TEST OF HUMAN PROBABILITIES AFTER CONSIDERING THE SURROU NDING CIRCUMSTANCES. IF THIS TEST IS APPLIED IN THIS MATTER, IT IS CLEARLY ESTAB LISH THAT THE ASSESSEE HAS FAILED TO PROVE THE GENUINE GIFT IN THE MATER. RATHER IT IS A CASE OF NO EVIDENCE TO PROVE CREDITWORTHINESS OF THE CREDITOR AND GENUINENESS OF THE GIFT. WE, THEREFORE, DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE ON THI S GROUND. THE SAME IS ACCORDINGLY DISMISSED. 7. ON GROUND NO. 2, THE ASSESSEE CHALLENGED ADDITIO N OF RS.25,000/-. THE ASSESSEE CLAIMED THAT SHE WAS HAVING CASH IN HAND O F RS.32,000/- AS ON 01.04.2006. THE AO, HOWEVER, ACCEPTED CASH IN HAND AT RS.7,000/- AND MADE ADDITION OF RS.25,000/- BEING UNEXPLAINED CASH. AT THE APPELLATE STAGE THE CLAIM OF THE ASSESSEE WAS NOT SUBSTANTIATED THROUGH ANY EVID ENCE. THEREFORE, THE APPEAL OF THE ASSESSEE WAS DISMISSED. 8. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE DO N OT FIND ANY MERIT IN THIS GROUND APPEAL OF THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE REFERRED TO PB-34, WHICH IS BALANCE SHEET AS ON 31.03.2006, SHOWING CA SH IN HAND OF RS.32,000/- WHICH RELATES TO PRECEDING ASSESSMENT YEAR 2006-07. THE ASSESSEE HAS NOT FILED COPY OF ACKNOWLEDGEMENT OF FILING OF RETURN OF INCO ME FOR THE ASSESSMENT YEAR 2006-07 TO SHOW THE SAID BALANCE SHEET IF WAS FILED WITH THE REVENUE AUTHORITIES ITA NO. 88/AGRA/2013 8 ALONG WITH THE RETURN OF INCOME. NO EVIDENCE WAS FU RNISHED IN THIS REGARD BEFORE THE AO. THE AO SPECIFICALLY NOTED THAT THE SAID AMO UNT WAS NOT DISCLOSED IN THE RETURN OF INCOME. THE LD. COUNSEL FOR THE ASSESSEE ADMITTED BEFORE US THAT SUCH BALANCE SHEET AS ON 31.03.2006 (PB-34) WAS FILED FO R THE FIRST TIME AT THE ASSESSMENT STAGE. IT WOULD, THEREFORE, DISCLOSE THA T THERE IS NO EVIDENCE TO PROVE AVAILABILITY OF CASH IN HAND OF RS.32,000/- WITH TH E ASSESSEE AS ON 01.04.2006. IN THE ABSENCE OF ANY DOCUMENTARY EVIDENCE AND THAT TH E CLAIM IS MADE FOR THE FIRST TIME AT THE ASSESSMENT STAGE WOULD CLEARLY REVEAL T HAT THE EXPLANATION OF THE ASSESSEE IS AFTERTHOUGHT AND CONCOCTED. THEREFORE, THE SAME HAS NO MERIT. GROUND NO. 2 OF APPEAL OF THE ASSESSEE IS ACCORDINGLY DISM ISSED. 9. ON GROUND NO. 3, THE ASSESSEE CHALLENGED ADDITIO N OF RS.16,000/- TOWARDS HOUSEHOLD WITHDRAWALS. THE ASSESSEE HAS SHOWN HOUSE HOLD WITHDRAWALS OF RS.32,000/- IN THE CAPITAL ACCOUNT. THE AO IN THE A BSENCE OF DETAILS OF HOUSEHOLD EXPENSES, ESTIMATED THE SAME AT RS.48,000/- AND MAD E ADDITION OF RS.16,000/-. THE LD. CIT(A) ALSO CONFIRMED THE ADDITION. 10. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, WE D O NOT FIND ANY JUSTIFICATION TO SUSTAIN THE ADDITION. THE AO HAS NOT GIVEN ANY BASI S AS TO HOW THE HOUSEHOLD EXPENSES SHOWN BY THE ASSESSEE WERE NOT SUFFICIENT TO MEET OUT HER DAY-TO-DAY REQUIREMENT. IN THE ABSENCE OF ANY REASONS OR MATER IAL BROUGHT ON RECORD, THE AO ITA NO. 88/AGRA/2013 9 WAS NOT JUSTIFIED IN ESTIMATING THE HOUSEHOLD EXPEN SES AT A HIGHER FIGURE. WE, THEREFORE, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE ADDITION OF RS.16,000/-. GROUND NO. 3 OF APPEAL OF THE ASSESSEE IS, ACCORDINGLY ALLOWED. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY