JAYSHREEBEN ROHITBHAI PATEL,AHMEDABAD V. THE ITO, WARD-5(2)(2), AHMEDABAD

ITA 1524/AHD/2025

AI Insights

The case involves Jayshreeben Rohitbhai Patel, who appealed against the order of the Ld. Commissioner of Income-tax (Appeals), which upheld the addition of Rs.51,32,442 to her income for the Assessment Year 2012-13 under section 68 of the Income Tax Act, 1961. The addition was based on the allegation that the source of the unsecured loans advanced by the assessee to M/s Marck Biosciences Ltd was unexplained. The assessee contended that the amount represented a gift from her deceased father, which was received through foreign inward remittance and was exempt under section 56(2)(vii) of the Act. The Tribunal found that the relationship between the donor and donee, and the receipt of money through banking channels, were established, and thus, the addition under section 68 was not justified.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 833795 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 01-08-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAMAL DEEP SINGH
• Assessee Lawyers: VIJAY H PATEL
• Keywords: Set aside; Additional evidence; Reassessment proceedings; Gift
• Section: 147; 148; 68

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD BEFORE DR. B.R.R. KUMAR, VICE-PRESIDENT SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER ITA No.1524/Ahd/2025 (Assessment Year: 2012-13) Jayshreeben Rohitbhai Patel, 9, Chinubhai Centre, Ashram Road, Ahmedabad-380006. [PAN :AAWPP1043 J] Vs. The Income Tax Officer, Ward-5(2)(2), Ahmedabad. (Appellant) .. (Respondent) Appellant by : Shri Vijay H Patel, AR Respondent by: Shri Kamal Deep Singh, Sr. DR Date of Hearing 09.12.2025 Date of Pronouncement 04.02.2026 O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:- This appeal has been filed by the assessee against the order dated 18.07.2025 passed by the Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)” for short), under Section 250 of the Income-tax Act, 1961 (“the Act” for short) for Assessment Year 2012-13. 2. The assessee has raised the following grounds of appeal: 1. The learned CIT(A) has erred in law and on facts in initiating reopening proceedings /s.147 for the year under consideration for fishing and roving enquiries on the basis of summons issued u/s.133(6) of the I.T Act 1961. The Ld. Assessing Officer lacks jurisdiction for such action. 2. The learned CIT(A) has also erred in law and on facts in making the addition of Rs.51,32,442/- u/s.68 of the Income Tax Act, 1961 disregarding the submission of the assessee and making the addition on non-existent material, and on surmises and conjunctures disregarding correct state of affairs. Printed from counselvise.com ITA No. 1524/Ahd/2025 Jayshree Rohitkumar Patel Vs. ITO Asst. Year : 2012-13 - 2– 3. The Ld. CIT(Appeal) has erred in law and on facts in making addition u/s.68 of the IT Act when the said section in not applicable to gift received by a daughter from her father. 4. The Learned Assessing Officer has erred in law and on facts in making addition of Rs.51,38,550/- by resorting to section 68 when assessee is not maintaining books of account.”. 3. The facts of the case are that the assessee is an individual. No return of income was originally filed for Assessment Year 2012-13. Subsequently, the assessment was reopened u/s 147 of the Act on the basis of information received from DCIT, Circle 2(1)(2), Ahmedabad, alleging that the assessee had advanced unsecured loans amounting to Rs. 51,00,000/- to M/s Marck Biosciences Ltd and the source of the same was unexplained. Pursuant to notice u/s 148 of the Act, the assessee filed her return of income on 27.04.2019 declaring total income of Rs.8,47,422/-. During the course of assessment proceedings, the assessee explained that the source of the loan advanced was out of the gift of Rs. 51,32,442/- received from her father, Late Shri Babubhai A. Patel, in foreign currency on 11.12.2011. It was explained that her father was residing abroad and expired on 31.03.2015 in Nairobi, Kenya. The Assessing Officer required the assessee to furnish documentary evidence to prove the genuineness of the gift and the creditworthiness of the donor, including bank statements and income details of the donor abroad. The assessee expressed her inability to produce such documents, stating that the same were not in her possession and requested the Assessing Officer to obtain information through international treaty for exchange of information mechanisms. The Assessing Officer rejected the explanation and treated the amount of Rs.51,32,442/- as unexplained income, invoking section 68 of the Act. 4. Aggrieved by the assessment order, the assessee preferred an appeal before the Ld. CIT(A). The Ld. CIT(A) called for a remand report from the Assessing Officer. In the remand report, the Assessing Officer reiterated that the assessee failed to establish the genuineness of the gift and the creditworthiness Printed from counselvise.com ITA No. 1524/Ahd/2025 Jayshree Rohitkumar Patel Vs. ITO Asst. Year : 2012-13 - 3– of the donor. The Ld. CIT(A), after admitting the additional evidence, upheld the addition, holding that the assessee failed to discharge the onus cast upon her. 5. Aggrieved by the order of the Ld. CIT(A), the assessee is now in appeal before the Tribunal. 6. Before us, the Ld. AR submitted that the section 68 of the Act is not applicable in the absence of books of account. The Ld. AR also submitted that the amount represented a gift from her father, which is exempt u/s 56(2)(vii) of the Act and the receipt was through banking channels as a foreign inward remittance. The Ld. AR also submitted the evidences of certificate from Bank of Baroda confirming foreign inward remittance. 7. The Ld. DR, on the other hand, supported the orders of the authorities below and submitted that the addition was rightly made u/s 68 of the Act. 8. We have heard the rival contentions and perused the material available on record. In the present case, it is an undisputed fact that the assessee is an individual who does not maintain any books of account. The alleged credit is reflected only in the bank statement. The assessee has claimed that the amount represents a gift received from her father. The relationship between the donor and donee is not disputed. The receipt of money through banking channels as foreign inward remittance is also not disputed by the Revenue. Once the relationship and receipt through banking channels are established, the transaction cannot be taxed merely on the ground that further documentary evidence regarding the donor’s foreign income could not be produced, particularly when the donor had expired prior to initiation of reassessment proceedings. The assessee has also produced before us the copy of death certificate of her father, copy of his passport, bank passbook showing foreign inward remittance, certificate from Bank of Baroda. Therefore, in our Printed from counselvise.com ITA No. 1524/Ahd/2025 Jayshree Rohitkumar Patel Vs. ITO Asst. Year : 2012-13 - 4– considered opinion, the explanation offered by the assessee appears reasonable and the additions cannot be sustained merely on suspicion or conjectures. In the peculiar facts and circumstances of the instant case, in view of the discussion above, we hold that the addition of Rs.51,32,442/- made u/s 68 of the Act is not sustainable in law and the order passed by the Ld. CIT(A) confirming the said addition is set aside. 9. In the result, the appeal of the assessee is allowed. The order is pronounced in the open Court on 04.02.2026. Sd/- Sd/- (SIDDHARTHA NAUTIYAL) (DR. B.R.R. KUMAR) JUDICIAL MEMBER VICE-PRESIDENT Ahmedabad; Dated 04.02.2026 **btk आदेश की \u0007ितिलिप अ ेिषत/Copy of the Order forwarded to : 1. अपीलाथ\u0007 / The Appellant 2. \b थ\u0007 / The Respondent. 3. संबंिधत आयकर आयु\u0015 / Concerned CIT 4. आयकर आयु\u0015(अपील) / The CIT(A)- 5. िवभागीय \bितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, True Copy सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad Printed from counselvise.com "