Sri G.N. Mohan, Mysore V. ITO, Bangalore

ITA 893/BANG/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 8474 (ITAT-BANGALORE)
• Duration Of Justice: 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 15-03-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 02-09-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V S SREELEKHA
• Assessee Lawyers: S VENKATESAN
• Keywords: Gift
• Section: 80C; 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE B BENCH, BANGALORE BEFORE SHRI SHAILENDRA KUMAR YADAV, JM AND SHRI A. MOHAN ALANKAMONY, AM ITA NO.893(BANG.)/2009 (ASSESSMENT YEAR : 2006-07) SHRI G.N.MOHAN, 9, KRISHNA BLOCK, POLICE QUARTERS, KAMAKSHI HOSPITAL ROAD, SARASWATHIPURAM, MYSORE APPELLANT VS THE INCOME-TAX OFFICER, WARD-1(4), MYSORE RESPONDENT ASSESSEE BY : SHRI S. VENKATESAN REVENUE BY : SMT. V.S.SREELEKHA O R D E R PER SHAILENDRA KUMAR YADAV, JM : THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), MYSORE DATED 15-07-2009 ON THE FOLLOWING GR OUNDS; 1. THE ORDERS OF THE AUTHORITIES BELOW IN SO FAR AS THEY ARE AGAINST THE ASSESSEE ARE OPPOSED TO LAW, EQUITY AND WEIGHT OF EVIDENCE, PROBABILITIES, FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LEARNED CIT(A) IS NOT JUSTIFIED IN SUSTAINI NG A SUM OF RS.3.0 LAKHS FROM OUT OF THE ADDITION MADE BY THE A O OF A SUM OF RS.4.00 LAKHS BEING THE GIFT GIVEN BY ASSES SEES FATHER-IN-LAW AS NOT A GENUINE GIFT UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE ASSESSEES CASE. THE ADDITION MADE IS ITA NO.893(B)/09 2 PURELY ON SUSPICION AND SURMISE, ASSUMPTIONS AND PRESUMPTIONS AND CONTRARY TO EVIDENCE ON RECORD AND THEREFORE, THE ADDITION MADE REQUIRES TO BE DELETED . 3. THE AUTHORITIES BELOW ARE NOT JUSTIFIED IN ASSE SSING A SUM OF RS.1.00 LAKH BEING THE GIFT GIVEN BY THE AS SESSEES BROTHER AS NOT A GENUINE GIFT UNDER THE FACTS AND I N THE CIRCUMSTANCES OF THE ASSESSEES CASE. THE ADDITION MADE IS PURELY ON SUSPICION AND SURMISE, ASSUMPTIONS AND PRESUMPTIONS AND CONTRARY TO EVIDENCE ON RECORD AND THEREFORE, THE ADDITION MADE REQUIRES TO BE DELETED . 4. THE AUTHORITIES BELOW ARE NOT JUSTIFIED IN ASSE SSING A SUM OF RS.2.00 LAKHS BEING THE GIFT GIVEN BY THE AS SESSEES BROTHERIN-LAW AS NOT A GENUINE GIFT UNDER THE FACT S AND IN THE CIRCUMSTANCES OF THE ASSESSEES CASE. THE ADDIT ION MADE IS PURELY ON SUSPICION AND SURMISE, ASSUMPTIONS AND PRESUMPTIONS AND CONTRARY TO EVIDENCE ON RECORD AND THEREFORE, THE ADDITION MADE REQUIRES TO BE DELETED . 5. THE AUTHORITIES BELOW ARE NOT JUSTIFIED IN DEN YING THE DEDUCTION CLAIMED U/S 80C OF THE ACT OF RS.1.00 LAKH UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE ASS ESSEES CASE. 6. WITHOUT PREJUDICE TO THE RIGHT TO SEEK WAIVER WITH THE HONBLE CCIT/DG THE ASSESSEE DENIES HIMSELF LIA BLE TO BE CHARGED TO INTEREST U/S 234B OF THE IT ACT, WHICH U NDER THE FACTS AND IN THE CIRCUMSTANCES OF THE ASSESSEES CA SE DESERVES TO E CANCELLED. 2. THE FIRST ISSUE COVERED IN GROUND NOS.1 TO 4 IS WITH REGARD TO GENUINENESS OF THE GIFT. AT THE OUTSET OF HEARING , IT WAS POINTED OUT ITA NO.893(B)/09 3 BY THE AR THAT THIS ISSUE IS COVERED IN ASSESSEES OWN CASE IN ITA NO.1214(B)/08 FOR THE AY: 2005-06, WHEREIN SIMILAR ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE AS UNDER; FROM THE FACTS, IT IS SEEN THAT FATHER-IN-LAW OF THE ASSESSEE, APART FROM FILING CONFIRMATION LETTER, HA D ALSO APPEARED BEFORE THE AO AND STATED ON OATH THAT HE HAS GIVEN GIFT T HIS SON-IN-LAW IN A SUM OF RS.2,50,000/-. THE ADDITION MADE BY THE AO AND SUSTAINED BY THE LEARNED CIT(A) ARE PURELY ON SUSPICION AND SURMISE. NO OTHER CONVINCING AND COGENT MATERIAL WAS BROUGHT ON RECORD BOTH BY THE AO AND THE LEARNED CIT(A) THAT NO SUCH GIFT WAS GIV EN TO THE ASSESSEE. BOTH THE AUTHORITIES BELOW FAILED TO ASSAIL THE STATEMENT RECORDED ON OATH. WE, THEREFO RE, DELETE THE ADDITION OF RS.1.00 LAKH SUSTAINED BY TH E LEARNED CIT(A). IT IS ORDERED ACCORDINGLY. 3. FACTS BEING SIMILAR, SO FOLLOWING THE SAME REAS ONING WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF THE C IT(A). WE DELETE THE ADDITION OF RS.3.00 LAKHS, OUT OF THE ADDITION OF R S.4.00 LAKHS MADE BY THE AO, BEING THE GIFT GIVEN BY THE ASSESSEES F ATHER IN LAW. SIMILARLY, A GIFT OF RS.1.00 LAKH RECEIVED FROM ASS ESSEES BROTHER CANNOT BE SAID TO BE NON-GENUINE. FURTHER, ON SIMI LAR LINE AN ADDITION OF RS.2.00 LAKHS BEING THE GIFT GIVEN BY T HE ASSESSEES BROTHER-IN-LAW IS NOT JUSTIFIED AND THE SAME IS ALS O DIRECTED TO BE DELETED. THE AFORESAID GIFTS WERE GIVEN AT THE TIM E OF CONSTRUCTION OF ITA NO.893(B)/09 4 THE ASSESSEES HOUSE BY ASSESSEES FATHER-IN-LAW, B OTHER-IN-LAW AND BOTHER ARE NOT UNUSUAL PHENOMENA AND THE SAME MAY B E GIVEN OUT OF LOVE AND AFFECTION. THERE IS NO CASE BY REVENUE TH AT ASSESSEES OWN MONEY WAS ROUTED THROUGH THE ABOVE SAID RELATIVES. ACCORDINGLY, THE ADDITIONS IN QUESTION ARE DELETED. 4. THE NEXT ISSUE IS WITH REGARD TO DEDUCTION CLA IMED U/S 80C OF THE IT ACT. THE ISSUE OF 80C HAS BEEN DENIED O N THE GROUND THAT THE PROPERTY IN QUESTION HAD BEEN LET OUT FOR COMME RCIAL PURPOSE, WHILE RELIEF U/S 80C ARE GRANTED FOR RESIDENTIAL PR EMISES. THE QUESTION OF RESIDENTIAL PREMISES HAS TO BE LOOKED A T THE TIME OF CONSTRUCTION OF THE BUILDING. FOR THIS THE AO IS S UPPOSED TO LOOK INTO WHETHER THE SITE PLAN FROM THE CONCERNED MUNICIPAL CORPORATION HAD BEEN OBTAINED FOR THE RESIDENTIAL PURPOSE OR OTHERW ISE. THE AO ALSO SHOULD LOOK INTO THE COMPLETION CERTIFICATE OF THE BUILDING WHETHER THE SAME WAS GIVEN FOR RESIDENTIAL PURPOSE. FURTHER THE AO ALSO CAN LOOK INTO THE ISSUE, WHETHER THE LOAN FOR SAME WAS OBTAI NED FOR THE PURPOSE OF RESIDENTIAL PROPERTY OR OTHERWISE. IN CA SE, UNDER COMPELLING SITUATION, IF THE ASSESSEE HAD TO LET OU T THE PREMISES FOR COMMERCIAL PURPOSE, IT WILL NOT CHANGE THE BASIC CH ARACTER OF PROPERTY. THE RESIDENTIAL CHARACTER OF PROPERTY HAS TO BE DET ERMINED FROM THE PURPOSE FOR WHICH CONSTRUCTION WAS RAISED AND OBTAI NING LOAN FOR THE SAME. IN CASE, THE ASSESSEE HAS TO LET OUT THE PRO PERTY IN QUESTION FOR COMMERCIAL PURPOSE, HE MAY HAVE TO PAY THE COMMERCI AL TAX ON THE ITA NO.893(B)/09 5 SAID PROPERTY AND ELECTRICITY CHARGES AT HIGHER RAT E. ACCORDINGLY, WE RESTORE THIS ISSUE TO THE AO WITH DIRECTION TO DECI DE THE SAME IN LIGHT OF ABOVE DISCUSSION AND AS PER LAW AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO ASSESSEE. THIS ISSUE IS ALLOWED FOR STAT ISTICAL PURPOSES. 5. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE (A. MOHAN ALANKAMONY) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE: BANGALORE DATED: AM* COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3. CIT(A) 4. CIT 5. DR 6. GF(BLORE) 7. GF(DELHI) BY ORDER AR, ITAT, BANGALORE