SURENDRA RAM BHARTI,DHANBAD V. ITO WARD-2(2), DHANBAD

ITA 138/RAN/2023

AI Insights

The case involves Surendra Ram Bharti, the appellant, contesting the taxability of a Rs. 31,900 prize, which he claimed was a gift from TATA Teleservices Ltd. through a scratch card, rather than a lottery win. The Assessing Officer had initially taxed this amount under Section 115BB(ii) of the Income Tax Act, 1961, treating it as lottery winnings, with only Rs. 5,000 exempted. The Commissioner of Income Tax (Appeals) upheld this decision. However, the Tribunal found that the nature of the prize as a gift or lottery had not been adequately adjudicated and thus remanded the case for further investigation and a new decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 470590 (ITAT-RANCHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside; Gift; Principle of natural justice

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH(SMC), RANCHI BEFORE SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA No. 138/Ran/2023 (Assessment Year 2008-09) (Physical Hearing) Surendra Ram Bharti, Lower Rajbari Road, Jharia, Dhanbad-828111 (Jharkhand) PAN No. ANUPB 7640 Q Vs. I.T.O., Ward 2(2), Dhanbad. Appellant/ Assessee Respondent/ Revenue Assessee represented by Rajesh Kumar Kapardar, Adv. Department represented by Shri Khubchand T. Pandya, Sr.DR Date of hearing 04/02/2025 Date of pronouncement 06/02/2025 O R D E R PER: PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER: 1. This appeal preferred by the assessee emanates from the order of learned Commissioner of Income Tax (Appeals), Dhanbad [in short, the ld. CIT(A)] dated 25/01/2019 for the Assessment Year (AY) 2008-09 as per the grounds of appeal on record. 2. This is a matter in which the department has alleged that the assessee has won Rs. 31,900/- from lottery. The Assessing Officer provided relief of Rs. 5,000/- as maximum limit of allowability under the Act. Therefore, the addition of Rs. 26,767/- was made by the Assessing Officer stating that this amount had to be taxed under Section 115BB(ii) of the Income Tax Act, 1961 (in short, the Act) at higher rate. The same was upheld by the ld. CIT(A). ITA No. 138/Ran/2023 Surendra Ram Bharti Vs ITO 2 3. Per contra, the contention of assessee through ld. Authorised Representative that it is not a lottery rather it is a gift from TATA Teleservices Ltd. in the form of scratch card which was given to the assessee. The assessee had won a bike through scratch card of which the value was Rs. 31,900/-. Therefore, question does not arise for taxing this amount of gift at a higher rate under Section 115BB(ii) of the Act. 4. I have carefully considered the submissions placed by the parties and the documents on record alongwith facts and circumstances in this case. The contention of department is that the alleged amount has been won in lottery whereas the assessee has contended that it is in the nature of a gift. However, neither in the order of Assessing Officer nor in the order of ld. CIT(A), this fact has been adjudicated. In order to ascertain the taxability of an income, the relevant facts needs to be verified. In view thereof, I set aside the order of ld. CIT(A) and remand the matter back to the file of Assessing Officer for necessary verification and passing an order de novo as per law complying with the principles of natural justice. Needless to direct that before passing the order on merit, the Assessing Officer shall grant reasonable opportunity of hearing to the assessee. As per the above terms, the grounds of appeal raised by the assessee stands allowed for statistical purposes only. 5. In the result, this appeal of assessee is allowed for statistical purposes. Order announced in open court on 06th February, 2025. Sd/- (PARTHA SARATHI CHAUDHURY) JUDICIAL MEMBER Ranchi, Dated: 06/02/2025 ITA No. 138/Ran/2023 Surendra Ram Bharti Vs ITO 3 *Ranjan Copy to: 1. Assessee 2. Revenue 3. CIT 4. DR By order 5. Guard File Sr. Private Secretary, ITAT, Ranchi "